Cedi Weakens to GH¢11.46 Against US Dollar Amid Tight Interbank Supply

The Ghanaian cedi has weakened significantly in recent weeks, reversing some of its gains from last month. The currency depreciated by 1.85% to GH¢11.46 against the US dollar in the interbank market, and by 2.04% against the euro to GH¢13.31. This represents an 8.77% year-to-date depreciation for the cedi.

Databank Research attributes the cedi's weakness to strong corporate and offshore demand for foreign exchange, particularly for import payments and early year-end inventory build-up. The Bank of Ghana's reduced intervention target has also contributed to the market's tight liquidity.

However, GoldBod's planned US$700 million forex supply to commercial banks is expected to improve market liquidity and help contain the risk of a disorderly adjustment in the coming weeks. The cedi currently trades at GH¢11.95 against the dollar at forex bureaus.