The Ghana cedi posted a mild correction over the past two weeks, giving up part of its recent gains against some major trading currencies amid renewed demand for foreign exchange.
In the interbank market, the local currency weakened against the U.S. dollar and the euro, trading at GH¢11.00 to the dollar and GH¢12.70 to the euro.
That represented depreciations of 0.27 per cent and 0.47 per cent respectively. Against the British pound, however, the cedi edged up by 0.13 per cent to GH¢14.56.
A similar pattern emerged in the retail market, where the cedi softened slightly against the dollar to GH¢11.68, but strengthened against both the pound and the euro to close at GH¢15.30 and GH¢13.30 respectively.
Oil demand pressures weigh on local currency
According to Databank Research, the recent movement reflects growing foreign exchange demand, especially from players in the downstream petroleum sector.
“We believe the current cedi slippage is largely driven by mounting demand pressures, particularly from Bulk Oil Distribution Companies requiring more foreign currency amid elevated crude oil prices.” - Databank Research
It added that relatively stable retail rates suggest the market is still benefiting from narrow spreads and central bank support.
Outlook remains cautiously mixed
Analysts say the outlook for the cedi remains uncertain as geopolitical tensions in West Asia continue to influence global commodity and currency markets.
While higher gold and oil prices could support Ghana’s export earnings, the same conflict environment is also increasing safe-haven demand for foreign currencies and putting pressure on energy-importing economies.
Despite these headwinds, the cedi’s performance remains broadly stable. The currency opened the week at GH¢11.70 to the U.S. dollar at forex bureaus, while its year-to-date appreciation still stands at 4.51 per cent, suggesting it has retained part of its earlier strength despite the latest pullback.
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