Analyst attributes higher Forex Bureau rates to liquidity crunch
By: Rebecca Okine
Economic analyst Emmanuel Boateng has explained that the widening gap between exchange rates offered by commercial banks and forex bureaus is largely due to liquidity challenges and high retail demand.
Speaking on Business Breakfast on Zed, Mr. Boateng said banks generally have access to larger and more stable volumes of foreign currency through regulated and official sources. This gives them an advantage in setting lower exchange rates compared to forex bureaus.
“More stable and larger volumes of foreign currency come through official channels and have to comply with strict regulations,” he said.
Forex bureaus, on the other hand, often have limited access to such official forex and are forced to purchase foreign currency from alternative markets. These sources tend to be more expensive, causing the bureaus to raise their exchange rates to recover costs.
Mr. Boateng explained that forex bureaus also face higher demand, particularly from individuals and retail clients who often prefer them for quicker access to currency.
“You see a lot more people going to forex bureaus when they need foreign currency than they would go to a bank,” he stated, adding that this demand-supply imbalance pushes rates even higher.
A forex bureau is a licensed financial outlet that deals primarily in the buying and selling of foreign currencies. While they offer more convenient services for retail transactions, their rates can vary based on supply conditions and access to forex.
Mr. Boateng concluded that the combination of limited liquidity and high customer demand explains why forex bureaus tend to offer higher rates than the interbank market.
His comments come amidst the appreciation of the cedi, with the interbank foreign exchange rate from the Bank of Ghana as of yesterday, June 18, 2025, selling at GHS10.30.
However, forex bureaus are pricing their rates around GHS12.00, highlighting the very gap Mr. Boateng attributes to liquidity limitations and increased retail demand.
