Ghana Central Bank: Liquidity growth slowed in the first four months of 2026

According to the May 2026 Monetary Policy Report of the Bank of Ghana, the annual growth in broad money supply (M2+) decelerated to 22.2 percent in April 2026, marking a significant slowdown compared to the same period of the previous year. This decline was primarily driven by a sharp drop in the contribution of Net Foreign Assets (NFA) to the money supply. The appreciation of the Cedi in 2025 affected this situation by reducing the local currency value of foreign currency-denominated assets.

In contrast, the contribution of Net Domestic Assets (NDA) to the money supply showed a strong increase, despite the negative values of the previous year. NDA's contribution to M2+ growth rose from minus 9.4 percent in April 2025 to 27.4 percent in April 2026. Domestic credit expansion in the banking sector was the main driving force behind this increase.

This positive outlook in NDA was mainly based on the increase in the Treasury's Net Claims on Government (NCG) and credit provided to the private sector. During this period, NCG's contribution to NDA growth rose from minus 14.5 percent a year ago to 15.5 percent. This indicates an increased demand by the banking sector for Ghana Government securities.