After a strong appreciation to peak reach around GHC10.02 to US$1.0 averagely, the Ghana cedi has broken the chain to run loose since August this year to sell at GH\u00a213.10 at Forex Bureaus, translating into a depreciation of 18.51 percent over less than the six weeks up to Tuesday, September 9, 2025.<\/p>\n
Many analysts have attributed the sharp fall to strong corporate demand and tight foreign exchange supply as the Bank of Ghana has moderated its forex liquidity injections on the foreign exchange market with supply lower than in May, June and July 2025 after the International Monetary Fund caution in previous month against excessive government intervention on the foreign exchange market.<\/p>\n
Market trend indicates that liquidity has been tight on the foreign exchange market as the market continues to correct itself. As of Friday, September 5, 2025, the local currency was going for c12.90 on average at the forex bureau but has since surged to GH\u00a213.10. However, analysts have warned this trend may continue if the forex supply is not increased.<\/p>\n
Instructively, Fitch Solutions had earlier revised its end-of-year forecast of the cedi-to-dollar at GH\u00a213.0, from its previous projection of GH\u00a215.5 to US$1.0, predicting a 12.9% appreciation against the US dollar in 2025.<\/p>\n
Consequently, President John D. Mahama has assured businesses and investors of greater currency stability, stressing that the government\u2019s focus on fiscal discipline, prudent expenditure management and stronger macroeconomic fundamentals will provide a more predictable environment for trade and investment.<\/p>\n
\u201cI believe that it is about stopping rapid depreciation of the currency. When you have steep depreciation of about like we had in 2024, 25% depreciation in the currency in the first half of the year, it makes planning difficult. And so yes, Bank of Ghana BoG has been intervening in the forex market, but they\u2019ve withdrawn,\u201d he said during his maiden Media Encounter last week.<\/p>\n
\u201cThe Cedi is making an adjustment, and I believe that it will settle at a certain rate, and we\u2019ll make sure that any depreciation that occurs in the value of the Cedi is within a margin of about 5% per annum,\u201d President Mahama added.<\/p>\n
The Cedi saw a sharp appreciation against major international currencies earlier this year but has slowed in recent weeks sparking fears over a reversal of the gains made.<\/p>\n
President Mahama projected that the cedi depreciation will remain moderate in the coming months, staying within a band of around 5% per annum, describing the recent currency fluctuations as part of a natural adjustment process rather than a sign of renewed instability, confirming that, the Bank of Ghana (BoG) has ceased interventions in the foreign exchange market.<\/p>\n
Meanwhile, the Vice Chancellor of the Methodist University of Ghana, Professor William Baah-Boateng, has welcomed the President\u2019s acceptance of moderate depreciation as encouraging for the economy.<\/p>\n
\u201cIf the president aims to keep the exchange rate beyond 5% then that is excellent. Now we are doing about GH\u00a212. When you take 5% of GH\u00a212, you are looking at about 60 pesewas. So, if the cedi hovers around GHc2.60, then it is the same as stability. If we can work around that, then that is what we will all be happy about,\u201d he explained.<\/p>\n
The economist also praised Ghana\u2019s recent progress on inflation management, attributing it partly to the cedi\u2019s appreciation and improved food supply during the ongoing harvesting season.<\/p>\n
\u201cSo far, we have done well when it comes to inflation because the appreciation of the cedi has contributed. Also, now we are in the harvesting season, and we have food in abundance,\u201d he noted.<\/p>\n
However, he cautioned that demand for foreign exchange could rise in the coming weeks as imports surge ahead of the festive season.<\/p>\n
\u201cBut what we have to work on is meeting the foreign exchange demand that will come as a result of imports for the festivities. If the central bank can meet that, then we will be able to maintain it at that level,\u201d he advised.<\/p>\n
<\/p>\n
By Adnan Adams Mohammed<\/p>\n","protected":false},"excerpt":{"rendered":"
After a strong appreciation to peak reach around GHC10.02 to US$1.0 averagely, the Ghana cedi has broken the chain to run loose since August this year to sell at GH\u00a213.10 at Forex Bureaus, translating into a depreciation of 18.51 percent over less than the six weeks up to Tuesday, September 9, 2025. Many analysts have<\/p>\n","protected":false},"author":3,"featured_media":8865,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[1401,120,276],"class_list":{"0":"post-8864","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy-and-finance","8":"tag-bank-of-ghana-bog","9":"tag-cedi-depreciation","10":"tag-fitch-solutions"},"yoast_head":"\n