Skip to main content

Cedi weakens further as second quarter FX demand pressures mount

 Cedi, dollarThe Ghana cedi continued its downward trend against major trading currencies over the past two weeks, as rising demand for foreign exchange and growing corporate repatriation needs intensified pressure on the local currency.

According to the latest market update, the cedi weakened across both the interbank and retail foreign exchange markets, with analysts attributing the depreciation to heightened demand for US dollars amid moderate foreign exchange supply conditions.

In the interbank market, the cedi traded at GHS 11.85 to the US dollar, down from GHS 11.63 recorded in the previous review period.

Similarly, the local currency depreciated against the British pound and the euro, with exchange rates rising to GHS 15.85/GBP and GHS 13.66/EUR from GHS 15.62 and GHS 13.49 respectively.

The weakness was also reflected in the retail market, where the cedi lost 0.81 percent against the dollar, 1.83 percent against the pound, and 1.40 percent against the euro, closing at mid-rates of GHS 12.30/USD, GHS 16.35/GBP and GHS 14.30/EUR.

On a month-on-month basis, the cedi depreciated by an average of 4.18 percent between April and May 2026, compared to the 3.23 percent decline recorded at the end of April.

This occurred despite approximately $1.1 billion in foreign exchange interventions by the Bank of Ghana during May.

Analysts noted that market sentiment remained largely bearish as demand for foreign currency continued to outpace supply.

The pressure on the cedi has also been linked to growing global demand for the US dollar, with central banks reportedly liquidating non-dollar assets to meet increasing import costs fueled by persistently high refined crude oil prices.

Looking ahead, market observers expect speculation in the foreign exchange market to remain relatively contained, supported by an announced $1.2 billion monthly foreign exchange support programme for June.

However, analysts caution that the cedi could face additional pressure in the coming weeks as multinational companies begin repatriating profits and dividends during the second-quarter repatriation period.

Corporate demand typically peaks during the Q2 repatriation window, driven by multinational dividend and profit outflows,” the report noted.

As a result, the dollar-cedi exchange rate is expected to weaken further beyond the current interbank level of GHS 11.85 unless foreign exchange inflows strengthen significantly.

Meanwhile, in South Africa, the rand also came under pressure during the review period, weakening by 1.15 percent to close at ZAR 16.28 per US dollar.

Analysts attributed the decline to elevated oil prices and renewed geopolitical tensions that have dampened investor risk appetite and increased concerns over import costs.

The outlook for the rand remains cautious, with elevated crude oil prices and uncertain global market conditions expected to keep the currency under pressure in the near term.

Comments

Popular posts from this blog

NESCAFÉ Launches Real Vibes Text & Win Promo to Reward Coffee Consumers Across Ghana

 NESCAFÉ has launched the Real Vibes Text & Win Promo, an exciting consumer promotion designed to reward loyal coffee lovers and bring the brand’s My Coffee, My Vibe experience even closer to consumers across the country. Running from September to December, the promotion gives consumers the opportunity to enjoy their favourite NESCAFÉ coffee while standing a chance to win exciting prizes, including phones, motorcycles, airtime and the ultimate grand prize—an electric SUV. Speaking at the launch, Lily Ntim, Category Development Manager for NESCAFÉ, said the promotion reflects NESCAFÉ’s commitment to creating, rewarding and memorable experiences for consumers. “Today, we are excited to introduce the NESCAFÉ Real Vibes Text & Win Promo, a campaign designed to bring the My Coffee, My Vibe experience even closer to our consumers,” she said. She added that the campaign is not only about prizes, but also about celebrating the everyday moments consumers enjoy with their coffee. “T...

Ghana Home Loans

With interest rates declining, a more liquid environment and a macroeconomic stability, mortgage financing is expected to see an ease of credit. And Ghana Home Loans being a leader in this industry is expected to lead the way. Ghana Home Loans (GHL), a leader in home mortgage, continues to be the frontier in fulfilling dreams of many Ghanaians in homeownership. Since starting business in 2006, it has also provided many existing homeowners with Equity Release mortgages to support their businesses, pay educational fees, improve their properties, or simply pursue other personal hobbies and interests. Ghana Home Loans is a mortgage finance institution which operates under Bank of Ghana’s supervision as a non-bank financial institution. At present, the Company remains the only such institution that focuses exclusively on the provision of mortgage product. Through the Home Completion mortgage and Home Construction mortgage products, Ghana Home Loans has enabled many qualified applican...

Tender Committee recommends E&P for Damang Mine lease transfer

  A Tender Committee has recommended the grant of the mining lease for the Damang Gold Mine to Engineers and Planners Limited, following a competitive evaluation process conducted by the Minerals Commission. The recommendation comes after a tender process initiated under Regulation 258 of the Minerals and Mining (Licensing Regulations), 2012 (LI 2176), aimed at selecting a strategic investor to take over the mining lease and operations of the Damang mine. According to the report, four companies responded to the public tender announced in the media. Out of these, two firms were shortlisted by the Mineral Titles Department of the Minerals Commission and subsequently submitted to the Tender Committee for detailed assessment. After what was described as a comprehensive evaluation, Engineers and Planners Limited emerged as the highest evaluated bidder, leading to the Committee’s recommendation for the award of the lease. Gold Fields Ghana Limited, which has operated in the country since...