Cedi posts strong gains against major currencies

The Ghana cedi has recorded a strong recovery over the past two weeks, reducing its year-to-date losses from nearly 11% to about 6%.

The improvement was mainly driven by increased foreign exchange support from the Bank of Ghana, which helped ease pressure on the market and reduce demand for dollars.

According to a report from Databank Research, the cedi performed strongly against the major international currencies in the interbank market.

During the period, it gained 5.66% against the US dollar, 6.76% against the British pound, and 6.24% against the euro.

Tariff hikes alone won’t fix power sector inefficiencies - Experts

The local currency closed at GH¢11.22 to the dollar, GH¢14.83 to the pound, and GH¢12.86 to the euro.

The cedi also strengthened in the retail market. It appreciated by 2.07% against the dollar to trade at GH¢12.05. It also gained 2.19% against the pound and 2.25% against the euro, closing at GH¢16.00 and GH¢13.90 respectively.

According to the report the cedi's strong performance was better than expected. Earlier forecasts suggested that the Bank of Ghana would inject more foreign exchange into the market later in June.

However, the central bank released significant amounts of discounted foreign exchange earlier than expected. This increased liquidity in the market and helped the cedi gain an average of about 6% over the two-week period.

The interventions also improved confidence among traders and investors by reducing speculation in the foreign exchange market.

Analysts and policymakers  believe the cedi could continue its upward trend in the coming weeks. This is because a large portion of the Bank of Ghana's estimated US$1.2 billion foreign exchange allocation for June 2026 is yet to be released.

The recent gains highlight the important role the Bank of Ghana is playing in stabilising the foreign exchange market and supporting the local currency.

ANAS/SA

Inside the AI revolution that could save lives on Ghana's roads