Cedi faces renewed pressure as Forex demand outpaces supply
The Ghana cedi has come under renewed pressure over the past two weeks, depreciating against major international currencies as rising demand for foreign exchange and increasing corporate repatriation requirements continue to weigh on the local currency.
According to the latest market data, the cedi weakened in both the interbank and retail foreign exchange markets amid strong demand for US dollars and relatively moderate foreign exchange inflows.
In the interbank market, the cedi declined to GHS 11.85 per US dollar from GHS 11.63 recorded during the previous review period. The local currency also lost ground against the British pound and the euro, with rates moving to GHS 15.85 per pound and GHS 13.66 per euro, compared with GHS 15.62 and GHS 13.49 respectively.
The trend was mirrored in the retail market, where the cedi depreciated by 0.81 percent against the US dollar, 1.83 percent against the pound sterling and 1.40 percent against the euro. It closed at average mid-market rates of GHS 12.30 per dollar, GHS 16.35 per pound and GHS 14.30 per euro.
The depreciation occurred despite foreign exchange interventions by the Bank of Ghana amounting to approximately US$1.1 billion in May. Data show that the cedi weakened by an average of 4.18 percent between April and May 2026, compared with a 3.23 percent depreciation recorded at the end of April.
According to a report by Citinewsroom.com, market analysts attribute the currency’s recent weakness to persistent demand for foreign exchange exceeding available supply. The situation has been compounded by increased global demand for the US dollar, as central banks liquidate non-dollar assets to finance rising import costs associated with elevated crude oil prices.
Analysts expect speculative activity in the foreign exchange market to remain relatively subdued in June, supported by the implementation of a US$1.2 billion monthly foreign exchange support programme.
However, they caution that additional pressure could emerge in the coming weeks as multinational companies begin repatriating profits and dividends during the second-quarter repatriation cycle.
“Corporate demand typically peaks during the Q2 repatriation window, driven by multinational dividend and profit outflows,” the report noted.
Market observers believe the dollar-cedi exchange rate could weaken further beyond the current interbank level of GHS 11.85 if foreign exchange inflows do not improve significantly.
Elsewhere on the continent, South Africa’s rand also recorded losses during the review period, depreciating by 1.15 percent to close at ZAR 16.28 per US dollar.
Analysts attributed the rand’s decline to sustained increases in global crude oil prices and renewed geopolitical tensions, which have dampened investor sentiment and heightened concerns over import-related costs.
The near-term outlook for the rand remains cautious, with elevated oil prices and uncertain global economic conditions expected to continue exerting pressure on the currency.
For Ghana, analysts maintain that strengthening foreign exchange inflows and maintaining market confidence will be crucial to stabilising the cedi and mitigating further depreciation pressures in the months ahead.
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