Pressure mounts on cedi; loses 9% in value to dollar last week
Cedi has fallen by more than 30% so far in 2022
Pressure on the Ghana cedi continues to surge after some sterling performance two weeks ago, making it the world’s top-performing currency during the period.
The local currency lost about 9% in value last week to the US dollar in the retail market to reverse the previous week’s gains.
It traded at an average of ¢11.50 to the American greenback in the retail market, whilst it went for about ¢10.89 on the interbank market. The cedi is however going for almost ¢12 at the forex bureaus.
It also ceded 4.8% week-on-week to the euro and 3.1% week-on-week to the pound respectively.
Analysts believe the sharp reversal in the cedi’s gains stemmed from widespread speculative foreign exchange purchases as the local currency strengthened following the International Monetary Fund deal.
However, it is expected the forex market rates will stabilise around the current levels until the mid-year budget review, with policy propositions and the scale of monetary policy adjustments envisaged under the programme potentially shaping market sentiments.
According to Bloomberg, the cedi has depreciated by about 12% to the American greenback since January 1, 2023, whilst the year-to-date depreciation of the cedi to the dollar on the interbank market is 21.8%.