Ghana’s local currency is expected to remain under significant strain in the coming months as demand for foreign exchange continues to outpace available supply, according to the latest assessment by economic research and advisory firm IC Insights.
The institution observed that the cedi declined by 4.6 per cent during May 2026 after a sharp increase in foreign exchange demand from corporate institutions and portfolio investors overwhelmed liquidity provided by the Bank of Ghana. The report noted that requests for foreign currency at the Central Bank’s weekly auction climbed to almost four times the amount available, creating a sizeable gap between demand and supply and placing additional pressure on the domestic currency.
IC Insights disclosed that total demand at the Bank of Ghana’s foreign exchange auctions reached approximately 3.83 billion United States dollars, representing nearly 3.8 times the volume supplied by the Central Bank. Analysts explained that the substantial shortfall has intensified downward pressure on the cedi and contributed to its latest bout of weakness against the American currency.
According to the firm, the current trend is likely to persist as elevated global energy prices continue to sustain strong appetite for foreign currency, particularly among import dependent businesses. However, the analysts also pointed to the speed of the recent depreciation as an indication that the market could experience some degree of correction before the close of the year if external conditions improve and foreign exchange inflows strengthen.
The findings add to broader concerns about the performance of the cedi after recent Bank of Ghana data showed that the currency has continued to weaken against the United States dollar during the first months of 2026, despite improvements in several macroeconomic indicators, including inflation and external reserves. Market observers believe that sustained import demand, portfolio adjustments and investor sentiment remain key factors influencing exchange rate movements.
As of the latest market quotations, the cedi is trading at around GH¢12.30 to one United States dollar in the retail foreign exchange market, while the interbank market rate stands at approximately GH¢11.74 to the dollar, reflecting the persistent gap between official trading levels and conditions on the open market.
