Banks are predicting a stronger cedi following the Bank of Ghana’s (BoG) largest auction of dollars since the beginning of the year.

According to Bank of Ghana market data reported by JoyBusiness, the Central Bank last week sold its largest amount of U.S. dollars so far this year, $243 million, to commercial banks through a (7) seven-day FX forward auction.

According to the data, BoG offered US$300 million; however, the commercial banks just accepted US$243 million, with a price range of GHC 12.15-12.40.

In response to this, the banks have predicted that this sale has the potential to stabilise the cedi in its trade against the dollar with this intervention from the BoG.

Even though trading between banks has increased since August, only about $4 million changed hands on Wednesday, so the market is still quiet.

The intervention comes shortly after President John Mahama announced at a recent media engagement that the BoG had withdrawn routine interventions in the forex market, stressing the need to strike a balance between supporting exporters and not overburdening importers.

At the Monetary Policy Committee press briefing held on Wednesday, September 17, Governor Dr Johnson Asiama assured that commercial banks have been adequately supplied with dollars to meet market demand.

At the briefing, he stated: “Over the past weeks, there was no single demand that we have not met. I will be really surprised if businesses are still having problems getting dollars from the commercial banks.”

Following this, reports indicate that the cedi’s depreciation on the market has slowed; however, it remains unclear whether BoG’s latest intervention could be linked to that.

Meanwhile, the Bank of Ghana has expressed optimism that current pressures on the cedi will normalise soon, backed by new monetary measures aimed at boosting forex inflows for commercial banks.

Director of Research Dr Philip Abradu-Otoo, during a media engagement, disclosed that the Central Bank’s directive requiring mining firms to channel their dollar inflows through local banks has already eased liquidity challenges.

“We have also seen remittances pick up after recent regulatory intervention, and all of these should go a long way to improve supplies on the market,” Dr Abradu-Otoo stated.

He added that cocoa inflows and expected donor disbursements in the coming months will further strengthen the forex supply.

“All these inflows should go a long way to improve the supply situation when it comes to the forex market,” he stressed.

Meanwhile, Bloomberg in April this year, ranked the cedi as the best-performing currency with a sixteen per cent (16%) gain against the dollar. What made the cedi earn the tag as the worst-performing currency is as a result of it seeing the steepest decline on the global level. The cedi’s appreciation in the last eight months helped ease inflationary pressures, pushing consumer inflation down to 21.2 per cent, the lowest in eight months at the time.

Ghana’s import-dependent economy brings in a wide range of goods, from food to machinery, with demand typically rising toward the end of the year as businesses prepare for the Christmas season. The higher demand for dollars has piled pressure on the cedi, while the Bank of Ghana’s (BoG) limited supply of foreign exchange also adds to the strain.

Head of Market-Risk Management at UMB Bank, Mr Hamza Adam, said banks that submitted dollar requests on behalf of clients to the Bank of Ghana the previous week received only half of what they asked for.

“This week the central bank is trying to meet all demand,” he said by phone from Accra on September 3, 2025.

Meanwhile, before Bloomberg reported on the cedi, BoG addressed the concerns of Ghanaians concerning the fast depreciation of the cedi, calling for calm. Bank of Ghana Governor, Dr Johnson Asiama, during an interview with Joy Business, which was aired on Wednesday, August 27, mentioned that the current depreciation of the cedi was temporary, assuring a comeback soon.

"The Bank of Ghana operates a managed floating system in terms of framework; therefore, these blips will happen. But the assurance is that this is a short-term issue, and the challenges are being addressed," he assured.

According to data from the Bank of Ghana, which was shared on 23rd August, the Ghana cedi had seen a five percent (5%) depreciation. Between August 23 and August 28, the Ghanaian cedi depreciated from GH¢10.43 to around GH¢11.00 per US dollar.

The sharpest movement was between August 23 and 24, where the cedi depreciated from GH¢10.43 to GH¢10.90. The dollar was selling at GH¢10.43 on August 23, GH¢10.90 on August 24, and between August 25 and 27, it staggered between GH¢10.85 and GH¢11.00.

As of August 28, it had crossed GH¢11 cedis, sparking major concerns. On Dr. Johnson Asiama’s part, the current depreciation is a result of the temporary shortage of foreign exchange supply in the market, resulting from the effects of the currency appreciation coupled with other phenomena that, “...we are beginning to see those phenomena at play. Imports become a lot cheaper, so it's just natural to begin to see pressure build up on the currency”.

He said there is no need for panic as the economic indicators are obviously strong, giving signs of a cedi recovery soon enough. Dr Asiamah attributed the depreciating cedi to the decline in remittance inflows, sharp appreciation of the cedi and limited interbank trading.

”…what is happening is just because of the sharp appreciation, we are beginning to have some cash flow problems, specifically because we have seen some decline in terms of remittance inflows. Also, imports become a lot cheaper, so it's just natural to begin to see pressure build up on the currency

“Over the last two months, we have also seen very limited interbank trading, he stated.”