Els: MBN360 Business
Ghana’s monetary sector recorded significant expansion in 2025, with Broad Money Supply (M2) rising steadily to close the year at GHS314.42 billion in December, up from GHS247.80 billion in December 2024.
The Bank of Ghana’s latest monetary survey data highlights a year marked by liquidity growth, rising deposits, and sustained financial system resilience despite fluctuations in key components.
The growth trajectory of M2 reflects consistent increases throughout the year. From GHS245.14 billion in January, money supply rose to GHS249.47 billion in February, GHS255.76 billion in March, and GHS259.87 billion in April. It continued upward to GHS267.72 billion in May, before moderating slightly to GHS265.19 billion in June.
The second half of the year saw stronger gains, with GHS276.93 billion in July, GHS275.48 billion in August, GHS277.59 billion in September, GHS282.47 billion in October, GHS289.44 billion in November, and finally GHS314.42 billion in December.
Net Foreign Assets Show Volatility but End Strong
Net Foreign Assets (NFA) displayed notable fluctuations during the year but ended on a strong note. From GHS85.02 billion in December 2024, NFA increased to GHS90.39 billion in January and GHS97.49 billion in February, peaking at GHS134.54 billion in April.
However, a sharp decline followed, with figures dropping to GHS75.20 billion in May, GHS75.77 billion in June, and GHS67.63 billion in July.
A recovery phase began in August at GHS79.70 billion, strengthening further to GHS101.77 billion in September, before easing to GHS89.64 billion in October and rising again to GHS99.94 billion in November. By December 2025, NFA had surged to GHS120.25 billion, reflecting improved external sector conditions.
The Bank of Ghana’s contribution to NFA rose from GHS45.25 billion in December 2024 to GHS98.30 billion in December 2025, while Deposit Money Banks recorded GHS21.96 billion at year-end, up from GHS39.77 billion the previous year but with fluctuations during the year.
Domestic Assets Drive Monetary Growth
Net Domestic Assets (NDA) remained a key driver of monetary expansion. Starting at GHS244.76 billion in December 2024, NDA declined to GHS207.12 billion in April 2025 before rebounding strongly to GHS264.04 billion by December 2025.
Net Claims on Government formed a substantial component, rising from GHS113.29 billion in December 2024 to GHS132.65 billion in December 2025. Claims on Government stood at GHS166.51 billion in December 2025, compared to GHS160.49 billion a year earlier. Government deposits, however, remained significant, closing at GHS33.86 billion, though lower than the GHS47.20 billion recorded in December 2024.
Credit to the private sector also showed resilience. Claims on the private sector and public enterprises increased from GHS101.05 billion in December 2024 to GHS115.19 billion in December 2025, reflecting gradual recovery in lending activity.
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Total Assets and Liabilities Expand
Total Assets in the banking system rose from GHS329.78 billion in December 2024 to GHS384.29 billion in December 2025, mirroring growth in Total Liabilities, which reached the same level.
Monthly asset figures showed steady progression, including GHS333.08 billion in January, GHS337.58 billion in February, GHS343.93 billion in March, and peaking toward year-end.
This expansion underscores the strengthening of Ghana’s financial system, supported by both domestic and external asset growth.
Deposit Growth Anchors Liquidity Expansion
Deposit mobilization played a crucial role in driving money supply growth. Demand deposits increased significantly from GHS104.14 billion in December 2024 to GHS137.70 billion in December 2025. Savings and time deposits also grew from GHS79.49 billion to GHS102.82 billion over the same period.
Foreign currency deposits fluctuated but remained elevated, closing at GHS69.88 billion in December 2025, compared to GHS81.98 billion in December 2024. Meanwhile, currency outside banks rose from GHS64.17 billion to GHS73.90 billion, indicating increased cash circulation within the economy.
Reserve Money and Liquidity Conditions
Reserve Money (RM) increased from GHS130.52 billion in December 2024 to GHS146.83 billion in December 2025, reflecting expansionary liquidity conditions. RM peaked at GHS144.94 billion in April before declining mid-year and rising again toward the end of the year.
Total Liquidity (M2+) followed a similar trend, rising from GHS329.78 billion to GHS384.29 billion, consistent with overall monetary growth.
Narrow Money (M1), which includes currency in circulation and demand deposits, increased from GHS168.31 billion in December 2024 to GHS211.59 billion in December 2025, reinforcing the strong upward trend in liquidity.
Stability in Key Ratios
Despite the expansion, key financial ratios remained relatively stable. The currency to deposit ratio hovered between 0.20 and 0.24, ending the year at 0.24, while the currency to M2 ratio remained steady at around 0.17 to 0.19, closing at 0.19.
These stable ratios indicate balanced growth between cash and deposit components, suggesting effective liquidity management within the banking system.
The sharp rise in Broad Money Supply to GHS314.42 billion highlights increased economic activity and financial deepening in Ghana. Growth in deposits, steady credit expansion, and improved foreign asset positions all point to a strengthening macroeconomic environment.
However, the fluctuations observed in Net Foreign Assets and government-related balances suggest that external shocks and fiscal dynamics remain key factors to watch. Going forward, sustaining this growth will depend on continued policy coordination, inflation management, and strengthening of the external sector.
