Cedi strength to hold in Q2 – Databank report
By Praisebell Rosemond Larbi
The Ghana cedi is projected to maintain its upward momentum against the US dollar through the second quarter of 2025, buoyed by strong foreign exchange (FX) support and growing investor confidence, according to a new report by Databank Research.
Databank attributes the cedi’s resilience to targeted interventions by the Bank of Ghana (BoG), expected inflows from the International Monetary Fund (IMF), and shifting global investor sentiment away from the US dollar.
The report highlights that the BoG’s active role in the forex market—through strategic liquidity injections and clear policy direction—has anchored expectations and stabilized the cedi.
“These interventions will continue to moderate volatility, smooth out imbalances, and reinforce investor trust in the local currency,” the report stated.
The cedi has appreciated sharply in recent weeks, currently trading at about GH¢12.90 to the US dollar on the retail market—marking one of its strongest rebounds in recent times.
Global economic shifts have also contributed. Databank points to rising uncertainty in the US economy—driven by trade tensions and fiscal instability—which has dampened investor appetite for dollar-denominated assets. This has created positive tailwinds for Sub-Saharan African currencies, including the cedi.
Domestically, improved macroeconomic stability—backed by Ghana’s policy reforms under the IMF programme—is also helping reduce speculative activity and capital flight.
“With improved confidence and lower capital slippage, the cedi is well-positioned to maintain its strength in the coming months,” the report noted.
Databank further emphasized the role of the IMF’s Extended Credit Facility (ECF) in bolstering Ghana’s foreign reserves. Ghana recently reached a staff-level agreement on the fourth review of the US$3 billion programme. Upon board approval, the country is expected to receive a US$370 million disbursement.
“We expect this inflow to augment existing FX buffers and enhance supply-side interventions, shielding the cedi from future external shocks,” the report added.
