Global conflicts contributing to Cedi depreciation — Prof Asuming

An economics lecturer at the University of Ghana, Professor Patrick Asuming, has attributed the recent depreciation of the Ghana cedi partly to escalating global conflicts and geopolitical uncertainties.

According to Prof Asuming, ongoing international tensions, including the conflict involving the United States and Iran, as well as the prolonged Russia-Ukraine war, are exerting pressure on economies worldwide and indirectly affecting the performance of the cedi.

Speaking in reaction to recent analyses published by Reuters, he explained that global instability often drives investors towards safer assets and stronger currencies, creating additional challenges for emerging market currencies such as the cedi.

“The global context is that since President Trump returned to office, we have seen different conflicts emerging in addition to the ongoing Russia-Ukraine war,” he said on Joy FM’s Super Morning Show on Monday, May 25.

“In recent times, we have also seen tensions involving Israel and the United States on one side and Iran on the other.”

Prof Asuming noted that such conflicts create uncertainty within the global economy, particularly through their impact on oil supply and international trade.

“These developments bring disturbances to the global economy, and Ghana is not exempt from the effects,” he explained.

Despite the recent depreciation, Prof Asuming said there was no immediate cause for alarm, insisting that the cedi’s decline had so far remained moderate.

“It is a depreciation compared to the appreciation we saw last year, but we have not witnessed extreme volatility,” he stated.

“By and large, the Bank of Ghana has been able to moderate the swings. I think the depreciation has generally been kept at a manageable level, and for that reason, I do not think we should start raising alarm.”

His comments come amid reports indicating that the Ghanaian currency has recorded a steady decline since the beginning of 2026.

READ ALSO: Slump continues as cedi becomes worst-performing currency in sub-Saharan Africa in 2026

Reuters, citing data from the London Stock Exchange Group (LSEG), recently reported that the cedi had emerged as the worst-performing currency in West Africa on a year-to-date basis due to persistent foreign exchange demand and other market pressures.

According to Reuters, strong demand for US dollars, particularly from the energy sector, rising oil prices and foreign exchange backlogs continue to weigh heavily on the local currency.

المصدر: MyJoyOnline (GH)