The Ghana cedi has recorded marginal gains against the US dollar on the interbank market for the second consecutive week, supported by improved foreign exchange liquidity.
Market watchers estimate the appreciation at just under 1%, offering some relief after sustained pressure on the local currency since the third quarter.
The pressure has been linked to increased demand for dollars by businesses financing imports ahead of December, as well as energy-related payments by the Bank of Ghana for crude oil and finished petroleum products.
The recent gains follow near-weekly depreciation since last month.
What is driving the recovery?
Market players have attributed the recovery to increased foreign exchange support, particularly dollar sales by the Ghana Gold Board (GoldBod).
On Tuesday, GoldBod sold US$197 million to commercial banks at a rate of GH¢11.70 to the dollar.
Joy Business understands that every participating bank received the full amount it requested, easing demand pressures and raising expectations of further gains for the cedi.
The sales, conducted through GoldBod’s GoFX platform, complement other measures by the Bank of Ghana to support liquidity in the foreign exchange market.
The intervention is in line with GoldBod’s plan to supply US$1 billion to commercial banks under its revised arrangements for foreign exchange receipts from gold exports in the artisanal and small-scale mining sector.
Some commercial banks have told Joy Business that they expect the cedi to remain fairly stable if the improved liquidity support is sustained.