The Ghana cedi is coming under renewed pressure as rising demand for US dollars from businesses and the energy sector puts the currency on track for further depreciation ahead of the Christmas trading season.
The latest market movements have raised concerns over the outlook for the cedi, although the Bank of Ghana (BoG) maintains that the pressure is part of normal market developments and expects the currency to remain relatively stable through the rest of 2026.
Market data and price quotes from several commercial banks show that the cedi depreciated by 1.86% against the US dollar in July, reversing part of the 3.30% appreciation recorded in June.
The June recovery was supported largely by increased foreign exchange intervention by the BoG, which injected $2.01 billion into the market to meet demand and support stability.
However, demand for dollars increased again in July, particularly from the energy sector as higher foreign exchange requirements for energy imports placed additional pressure on the currency.
The pressure has continued into August, with the cedi recording week-to-date and month-to-date depreciations of 0.52% and 1.66%, respectively. Its year-to-date depreciation currently stands at 8.06%.
Christmas trading raises dollar demand
Market watchers have identified preparations for the December Christmas shopping season as another source of pressure on the foreign exchange market.
Businesses are expected to increase their dollar purchases to finance imports ahead of the festive season, potentially keeping demand for foreign currency elevated in the coming months.
The situation is being compounded by movements in crude oil prices, which affect the amount of foreign exchange required to finance Ghana’s energy imports.
BoG prepares additional FX support
Despite the renewed depreciation, the Bank of Ghana remains confident that the foreign exchange market can be managed without undermining overall currency stability.
In its July Monetary Policy Report, the central bank acknowledged that renewed foreign exchange demand ahead of Christmas could create pressure on the cedi but maintained that the currency was expected to remain relatively stable over the medium term.
“Over the medium term, the Ghana cedi is expected to remain relatively stable,” the Bank stated.
It said foreign exchange interventions and remittance inflows would help moderate pressures on the currency.
“FX intermediation is expected to moderate the pressures on the cedi, along with remittance flows,” the Bank added.
As part of efforts to meet market demand, the BoG is expected to supply about $500 million to the market in September through its foreign exchange intermediation programme.
The Ghana Gold Board is also expected to contribute significantly to foreign exchange availability, targeting $1.4 billion in receipts during September.
Of that amount, $700 million is expected to be made available to commercial banks through spot sales and funded forward arrangements.
The remaining $700 million is expected to be transferred to the BoG for reserve accumulation under the Ghana Accelerated National Reserve Accumulation Policy (GANRAP).
The central bank has further assured the market that it remains ready to intervene when necessary to maintain orderly conditions while allowing the exchange rate to remain flexible.
The coming months will therefore be critical for the cedi as increased seasonal import demand, energy financing requirements, foreign exchange inflows and central bank interventions interact to determine the currency’s performance heading into the final quarter of 2026.
