Cedi depreciation short-term, fundamentals remain strong – BoG

The Governor of the Bank of Ghana (BoG), Dr Johnson Asiama, has assured the public and the business community that the recent weakening of the cedi is under control and does not amount to a currency crisis.

The local currency recorded sharp losses between Wednesday, 27 August and Friday, 29 August 2025, sliding from about GHS10.98 to GHS11.26 against the United States dollar.

This represents a depreciation of nearly 27 pesewas in just three days. Similar movements were observed against the British pound and the euro, which both declined by 40 pesewas and 34 pesewas respectively.

The swift depreciation stirred anxiety among households and businesses, raising concerns over whether the central bank was losing its grip on the market.

In an interview, Dr Asiama dismissed fears of a looming crisis, stressing that Ghana’s external position remains solid and the fundamentals supporting the currency are intact.

“We still have the grip, and the fundamentals that held the cedi in the previous months are still intact. Our net international reserves haven’t run out. There are adequate reserves to cover our expenditure as far as the rest of the world is concerned,” he said.

The Governor, however, admitted that challenges such as abuse of the import declaration system had placed pressure on the market, but noted that the Bank of Ghana was working to close such loopholes.

Seasonal Pressures

Dr Asiama explained that the depreciation should be understood as seasonal and not a sign of structural weakness in the economy.

“Remember, we are just entering into the cocoa season, and that’s another factor. If you look at it historically, before the onset of the cocoa season, you always found this type of pressure in the FX market,” he said.

He revealed that Ghana is expecting over USD4 billion in cocoa inflows in the coming weeks through pre-financing arrangements with international partners, which would help ease demand for foreign exchange.

“From what I’m told by the cocoa board, they are expecting over four billion US dollars in cocoa financing… So with all these prospects coming in, why panic? It’s a short-term thing we are contending with,” Dr Asiama assured.

Outlook

The Governor further pointed to other anticipated inflows, including remittances, which are expected to bolster the market and restore stability.

“When these inflows resume cocoa, remittances and others, you will begin to see stability return to the market. So why panic?” he asked.

For importers and households who have been hit by rising costs in recent weeks, Dr Asiama reiterated that the depreciation was temporary and that corrective measures were already in place.

He maintained that the country’s external viability remains strong and that with the expected inflows, the currency would soon regain stability.