The Bank of Ghana (BoG) has pledged to address the challenges facing the cedi.
This is in to recent turbulence in the foreign exchange market.
Governor Dr. Ernest Addison, speaking at the launch of the new commercial paper market, emphasized the central bank’s preparedness, stating, “The exchange rate has been generally stable until recent weeks when some headwinds have been observed in segments of the market. But this is given much attention as the bank has built up enough reserves to tackle the pressures on the market.”
Despite these assurances, concerns persist as the cedi continues to struggle against a backdrop of surging corporate dollar demand and a strengthening U.S. currency.
Financial analysts caution that the outlook for foreign exchange inflows remains uncertain, with factors such as elevated inflation and constrained portfolio inflows exacerbating the pressure on the local currency.
While the BoG has injected millions into the forex market this year, analysts suggest that more intervention may be necessary, especially as credit to the private sector remains subdued.
All eyes are now on the central bank’s forex reserves and its willingness to utilize them in the face of the cedi’s depreciation.
