The Ghana cedi came under the strongest exchange-rate pressure among African currencies monitored by the World Bank during the second quarter of 2026, as higher energy prices and global financial uncertainty intensified demand for foreign exchange.
The cedi weakened by nearly 10 per cent between March and June, recording the largest maximum depreciation among the currencies covered in the World Bank’s October 2026 Africa Economic Update.
The development occurred against the backdrop of the escalation of the conflict in the Middle East, which triggered sharp increases in oil and energy prices and placed additional pressure on African economies.
According to the World Bank, higher energy prices increased import bills, particularly for countries that rely heavily on energy imports. This raised demand for US dollars and weakened foreign exchange positions, intensifying depreciation pressures.
The cedi’s decline was more pronounced than those recorded by several other African currencies. Lesotho, Namibia, South Africa and Eswatini recorded maximum weakening of about seven per cent, while the Seychelles rupee fell by almost seven per cent. The Democratic Republic of Congo and Uganda recorded maximum declines of about six per cent and five per cent respectively.
The World Bank said the currency pressure was broad-based, with seven of the 22 countries monitored, excluding the CFA franc zone, recording maximum depreciations of more than five per cent. Ghana was among the countries with the sharpest movements, alongside the Democratic Republic of Congo, Seychelles and South Africa.
Beyond energy costs, the report identified heightened geopolitical uncertainty as another factor behind the pressure on African currencies. The uncertainty triggered a flight to safer assets in global financial markets, resulting in capital reallocation away from emerging and frontier economies.
For countries with significant external debt obligations, the depreciation also had fiscal implications because a weaker domestic currency increases the local-currency cost of servicing US dollar-denominated debt.
Cedi recovers some ground
Despite the sharp decline recorded between March and June, the cedi regained some ground by August as pressure on African currencies eased.
The World Bank said only 10 currencies remained weaker than their end-February levels by the end of August, although the cedi was still below its pre-shock position.
The report noted that the impact of the external shock differed significantly across African economies.
Countries with high dependence on energy imports, limited foreign exchange buffers and heavy debt-service obligations faced stronger pressure, while commodity exporters were relatively more resilient.
South Africa benefited from stronger demand for gold and platinum, which supported its foreign exchange earnings. Oil producers such as Angola and Nigeria also received stronger export receipts from higher crude oil prices, helping to cushion their currencies.
The World Bank’s assessment therefore places Ghana’s second-quarter currency weakness within a wider regional shock, while highlighting the cedi’s unusually sharp response to the combination of higher energy costs, foreign exchange pressures and global investor uncertainty.
Although some of the losses had been recovered by August, the cedi remained weaker than its end-February position, underscoring the continuing sensitivity of the currency to external financing and commodity-market developments.
