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The Ghana cedi is anticipated to remain stable against the US dollar and other major foreign currencies in the near term, supported by a sustained increase in reserves and improving liquidity conditions.
Market analysts suggest that these factors are likely to continue facilitating supply-side interventions in the foreign exchange (FX) market.
Ghana’s foreign exchange reserves, excluding encumbered assets, experienced a significant month-on-month increase of 63% in April 2025, reaching US$7.92 billion, which is equivalent to 3.7 months of import cover. This represents an increase from US$7.26 billion (3.3 months of import cover) recorded in March.
The rise in reserves can be primarily attributed to stronger inflows from gold and cocoa exports, as well as enhanced remittance receipts.
According to Databank Research, "We believe that the improved reserve position has provided the necessary buffers for targeted supply-side interventions, enhancing FX market liquidity and contributing to the stability of the cedi, which has appreciated by 26.73% year-to-date."
The firm also emphasized increased domestic optimism, noting that Ghana’s business confidence index rose from 99.7 points in February to 102.2 points in April 2025, indicating a potential reduction in demand for safe-haven assets—thereby further strengthening the cedi’s position.
Market Performance
In the previous week, the local currency continued to appreciate steadily against major foreign currencies:
- An 8.13% gain week-on-week against the US dollar
- A 7.19% gain against the British pound
- A 6.41% gain against the euro
The cedi concluded the week at a mid-rate of GH¢12.30 to $1 in the retail market. At the beginning of this week, it further strengthened, trading at GH¢11.80 to $1.
This positions the cedi’s year-to-date (YTD) appreciation at an estimated 38%.
Analysts attribute this sustained momentum to subdued demand pressures and improved forex liquidity, conditions that have bolstered the local currency in recent weeks.