Databank Research is projecting a near-term rebound in the cedi, supported by expected foreign exchange inflows that could help ease weak sentiment in the market.
The outlook follows a mixed performance by the local currency over the past two weeks, during which the cedi weakened slightly on the interbank market but strengthened in retail trading, a divergence Databank attributes to differing demand conditions across segments of the FX market.
According to the research firm, the USD/GHS interbank midrate closed at GHS 10.88, up from GHS 10.70 in the previous period, reflecting renewed demand pressures that outpaced FX supply. By contrast, retail rates improved, with the dollar easing to GHS 11.90 from GHS 12.15, signalling softer demand at forex bureaus.
The cedi also strengthened against other major currencies. On the interbank market, the pound sterling and the euro weakened by 2.70 per cent and 2.57 per cent, closing at GHS 14.78 and GHS 12.80, respectively. Similar trends were observed in retail trading, suggesting pricing adjustments by forex bureaus aimed at attracting buyers.
Databank notes that while renewed demand weighed on the cedi in the interbank market, subdued retail demand helped support modest gains outside the banking system.
Looking ahead, the research firm maintains a base-case projection of GHS 10.70 to the US dollar, describing the outlook as cautiously optimistic.
On the global front, Databank points to persistent dollar weakness as a potential tailwind for emerging and frontier market currencies, including the cedi. This is linked to sovereign investors gradually reducing exposure to US Treasury holdings, despite attractive yields, alongside expectations of a more dovish US Federal Reserve policy stance.
Overall, Databank’s analysis suggests that although short-term pressures remain in Ghana’s foreign exchange market, a combination of policy support, anticipated FX inflows, and favourable global currency dynamics could help stabilise the cedi in the weeks ahead.
