Ghana’s local currency, the cedi, has shown slight gains against key international currencies, including the US dollar, as observed in forex bureaus since October 2024.
The Central Bank’s daily update reported that as of 9:00 AM on January 15, 2025, the cedi was trading at a buying rate of GH¢14.84 and a selling rate of GH¢14.85.
For other notable currencies, the British pound was trading at GH¢18.17 for buying and GH¢18.19 for selling, while the euro was exchanged at GH¢15.28 and GH¢15.30, respectively.
By 9:00 AM on January 16, 2025, GhanaWeb Business revealed that the cedi was slightly weaker at GH¢15.85 to the dollar and GH¢19.70 to the pound at major forex bureaus. Meanwhile, the euro was retailing at GH¢16.60.
To mitigate the currency’s earlier depreciation, the Bank of Ghana injected over $200 million into the economy during the last quarter of 2024, reflecting efforts to stabilize the local currency.
The value of Ghana’s local currency, the cedi, continues to fall against major trading currencies, notably the US dollar.
As of 10:00 AM on Friday, August 16, 2024, the cedi is being exchanged at GH¢15.92 to $1 at prominent forex bureaus in Accra.
This depreciation is also observed with other major currencies, such as the British Pound and the Euro. Currently, the cedi is valued at GH¢20.50 to £1 and GH¢17.52 to €1 at leading forex bureaus nationwide.
According to Bloomberg, the Ghanaian cedi is ranked as the fourth-worst performing currency out of 150 tracked globally.
Despite a nearly 23% drop in value against the US dollar, the cedi has shown some signs of stability this month, as reported by Bloomberg.
This decline in the cedi’s value is attributed to the increased demand for US dollars needed for purchasing petroleum products, pharmaceuticals, and other imports.
Governor Addison emphasized the Bank’s substantial foreign exchange reserves, advising against speculative purchases, which could lead to economic losses when corrections occur.
At the 118th Monetary Policy Committee press conference on Monday, May 27, the BoG announced measures to enhance market conduct and maintain order in the foreign exchange market.
The Bank has collaborated with the Ghana Association of Banks to streamline documentation for foreign payments, reducing reliance on informal markets.
To address high demand pressures, the BoG has recently absorbed foreign exchange needs from some corporate institutions, easing pipeline demand from commercial banks.
Aware of illegal operators, the BoG is working with the Financial Intelligence Centre to clean up the foreign exchange market. Monitoring of foreign exchange bureau will be intensified to ensure compliance with regulations.
Foreign exchange bureaux must stop advertising rates outside their premises and on social media. The BoG has established a task force to oversee compliance. Election-year sentiments and statements affecting market confidence should be managed carefully.
In fiscal policy, expenditures exceeded revenue growth in the first quarter due to early IPP arrears payments. Maintaining fiscal discipline throughout the year is crucial for economic confidence.
The committee noted that consistent implementation of macroeconomic and structural reform policies aligns with the IMF-supported program. Efforts should prevent recent currency depreciation from affecting business pricing and inflation expectations.
The reserve build-up of about US$2 billion since the IMF program began, along with strong disinflation, fiscal consolidation progress, positive current account balances, and external debt restructuring advances, have provided buffers to support the exchange rate.
Forecasts indicate a slightly elevated inflation profile due to recent exchange rate pressures and transportation fare adjustments. However, inflation is expected to stay within the monetary policy consultation range of 13-17 percent by year-end, contingent on maintaining a tight monetary policy and aggressive liquidity management.
“Given these considerations, the Committee decided to maintain the Monetary Policy Rate at 29 percent,” he said.
A team has been established by the Bank of Ghana (BoG) to oversee all foreign exchange bureaus and guarantee adherence to their regulatory policies.
“The bank is fully aware of the operations of illegal operators in the foreign exchange market and is working with the financial intelligence centre to sanitize the market,” Dr Ernest Addison, the Governor of the Bank of Ghana, told a press conference.
He declared that increased oversight by the Foreign Exchange Bureau will be implemented to guarantee adherence to their established guidelines.
Accordingly, he stated, any foreign exchange bureaus that advertise rates outside of their locations and on social media sites had to stop doing so right away.
The Asantehene, Otumfuo Osei Tutu II, has appealed to the Bank of Ghana to take necessary steps to stabilize the forex market.
In a speech read on his behalf at the 19th Ashanti Business Excellence Awards by Sewuahene, Nana Kwaku Sarkodie, the Asantehene expressed worry over the depreciation of the local currency against other foreign trading currencies.
He urged the central bank to implement measures to bring predictability to Ghana`s export and import trade, as well as other international financial transactions.
“I will like to make reference to the unsettling turbulence which has characterized Ghana’s foreign currency market, Since the beginning of the year, there has been an astronomical depreciation of the cedi against Ghana’s major foreign currencies, particularly the US Dollar.
I have no doubt that the Bank of Ghana is doing its best to remedy the situation, but the central bank is doing its best to remedy the situation, but I must urge the central bank to urgently take all the requisite steps within its competence to return the foreign market to stability, in order to bring predictability to Ghana`s export and import trade, as well as other international financial transactions”, he said.
The cedi ended last week with a marginal appreciation, but the cedi has depreciated again to GH¢14.20 to one dollar which is the average quote by the forex bureaus.
According to the Bank of Ghana, however, the local currency is selling at GH¢13.014 on the interbank market. The cedi is also going for ¢15.60 and GH¢13.60 to one pound and one euro respectively.
The free fall of the cedi coupled with the recent economic crisis in the country has triggered calls for immediate measures to be implemented by the government to resolve the situation.
President Akufo Addo in his address on Sunday, October 30, announced some measures the government intends to put in place to address the fall of the cedi and the current economic crisis.
Prices of goods and services have risen sharply following the depreciation of the Ghana cedi against the dollar contributing to the economic situation in the country.
The cedi sells at GH¢14 to the US dollar at the forex bureaus or the retail market.
On the back of that, Nana Aba Anamoah has spoken against profiteering at such a critical moment in the country.
Highlighting the fact that some traders are charging unjustifiably high prices for goods, Nana Aba in a Twitter post said “Some traders are taking advantage of the current system to charge exorbitant prices for goods.”
Meanwhile, some Ghanaian celebrities have also complained bitterly about the hardships the country has been plagued with under the leadership of President Nana Addo Dankwa Akufo-Addo.
These celebrities, who seem ‘fed up’ have lamented the depreciating cedis to the dollar, the constant fuel price hikes, and the overall hardships that everyone in the country is currently experiencing.
The likes of Yvonne Nelson, Prince David Osei, Lydia Forson, Shatta Wale, Efia Odo, Kojo Cue, Sarkodie, and many others have cried out on social media.
The dollar has hit the ¢11 to $1 mark as some forex bureaus in parts of Accra are selling a dollar at an average of ¢11.2 on Saturday, October 8, 2022.
Checks by Joy Business indicate that the demand for the dollar keeps surging, as there is very little dollars in circulation.
Some forex bureau operators who spoke to Joy Business on condition of anonymity said the recent action by the Bank of Ghana has yielded little return.
According to them, there are no dollars in circulation.
But, they hope the inflows from the $1.13 billion cocoa syndicated loan will help improve supply and slow down the rate of depreciation of the currency. The first tranche is expected by the end of this month.
On the interbank market, the Bank of Ghana quoted the dollar at 9.63 (selling) on Friday, October 7, 2022.
Meanwhile, the cedi is also not faring well against the Pound and Euro.
It is going for ¢12.5 to the Pound and ¢10.57 to the Euro respectively.
Analysts say the local unit continues to post heavy losses on the interbank market as unrelenting foreign exchange demand continued to weigh down the cedi against the dollar.
Demand exceeded supply by last BoG Forex Forward Auctioning
The last Forex Forward by the Bank of Ghana indicated that demand exceeded supply by $75.25 million in the latest auction.
This is compared with the $82.75 million recorded a month ago.
Cedi loses 40% in value to the dollar – Bloomberg
Bloomberg quotation had earlier put the depreciation of the Ghana cedi at 40.05% in value to the US dollar in nine months of 2022.
This ranked it as the second worst-performing currency in the world in the 147th position, according to Bloomberg.
Also, this decline in the local currency against the American currency is the worst in over three decades.
Cedi loses 37.5% in value to a dollar as of September 30, 2022 – BoG
However, the Bank of Ghana said the Ghana cedi depreciated by 37.5% to the US dollar as of the end of September 2022.
At the same time, the cedi had depreciated by 24.1%, and 27.5% against the Pound, and Euro.
