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If you have visited a forex bureau recently, you may have noticed one thing: the cedi behaves like a friend who cannot decide whether to stay or leave a party. Up today, down tomorrow. One week it looks strong against the dollar, the next week it struggles.
On Tuesday, 19 August 2025, the interbank exchange rates in Ghana showed the US dollar trading at a buying rate of GH¢10.7946 and a selling rate of GH¢10.8054. The British pound sterling was quoted at GH¢14.5911 for buying and GH¢14.6067 for selling, while the euro recorded a buying rate of GH¢12.5970 and a selling rate of GH¢12.6094.
But why does the cedi keep fluctuating on the interbank market, and more importantly, how does that affect your pocket and your business?
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The interbank exchange rates in Ghana for 19 August 2025. Source: Bank of Ghana
What is the interbank market?
Think of it as a WhatsApp group for banks, but instead of jokes and memes, they trade foreign currencies among themselves. This is where the real exchange rate is set before it filters down to the forex bureaus and eventually the chop bar near you selling imported cooking oil.
Why does the cedi keep fluctuating?
1. Monetary policy and inflation control
The Bank of Ghana has kept interest rates tight at 28% to control inflation, which has dropped significantly to 13.7% as of June 2025 (down from 18.4% in May). This helps stabilise the cedi but also makes the currency react sharply to any inflationary pressure.
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2. Gold and commodity revenues
The cedi recently staged a comeback, gaining as much as 40–50% against the dollar in 2025. Why? Ghana’s gold exports brought in record inflows, and the central bank has been stockpiling reserves, reaching 34.40 tonnes by July 2025. The risk, however, is that if global gold prices fall, the cedi quickly loses that strength.
3. Debt restructuring and IMF support
Following difficult domestic debt swaps and agreements with external creditors, Ghana secured an IMF programme worth about $3 billion. This boosted forex liquidity and reassured investors. Yet, any challenge with debt repayments or IMF disbursements can make the cedi unstable.
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4. Improved forex market management
The Bank of Ghana has tightened FX market operations, introducing weighted-median pricing and stricter oversight to curb speculation. This has reduced some of the extreme volatility seen in previous years, but traders still respond quickly to global news.
5. Dollarisation habits
A major challenge is that too many transactions in Ghana still take place in dollars. From real estate to international school fees, many prefer the dollar over the cedi. This undermines confidence in the local currency and drives demand for dollars.
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6. External risks
Ghana’s heavy reliance on commodities such as gold and cocoa means that any global price crash or shock hits the cedi immediately. Analysts warn that the currency could fluctuate between GHS 10 and 12 per dollar in the near term depending on external pressures.
What does this mean for you?
For your pocket:
Imported goods like rice, oil, fuel, spare parts, and medicines are directly affected. Even local items linked to imports such as cement, sachet water, and pharmaceuticals see prices rise. Salaries in cedis lose purchasing power whenever the currency weakens.
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For your business:
If you import raw materials or finished products, your costs increase. Profit margins shrink unless you raise prices for customers. Some businesses hedge by holding part of their savings in dollars or diversifying suppliers.
For investors and savers:
A fluctuating cedi makes planning difficult. Treasury Bills may appear safe, but the real test is whether returns can beat both inflation and depreciation. Some investors are turning to balanced funds or fixed-income unit trusts, though these too are exposed to the cedi’s swings.
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The bottom line
The cedi’s journey is one of short-term gains and long-term challenges. Sound policies, gold exports, and IMF support may strengthen it temporarily, but dollarisation, reliance on imports, and structural economic issues hold it back.
For the average Ghanaian, this translates to higher prices at Makola, tighter household budgets, and unpredictable costs for businesses. Until Ghana addresses its deeper structural weaknesses by boosting exports, reducing dependence on imports, and building trust in the cedi, the interbank market will remain volatile.
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So, the next time you hear “cedi depreciation” on the news, remember: it is not just financial jargon. It is why your kenkey seller keeps adjusting prices and why that trip to Dubai suddenly feels twice as expensive.