The Ghanaian Cedi at the start of the week gained traction as it posted gains against its three major trading partner currencies on the Open Forex Market (oanda.com). On the Bank of Ghana (BoG) inter-bank trading platform, the Cedi fell marginally against the US Dollar and rose steadily to post gains against the British Pound Sterling and the Euro. After ending the previous year with its worst performance in four years, the Cedi is showing signs of recovering part of its previous losses as demand for forex moderates coupled with the central bank’s move to continue with its bi-monthly forex forward auctions.
Recent data released by BoG indicates that Ghana has made significant gains in its Gross International Reserves (GIR) which analysts believe could strengthen the hands of the central bank to support the local currency. The BoG has announced plans to auction USD 715 million in forex auctions in 2020 with a significant amount being offered in the first three months of the year. Ghana’s GIR increased by USD 1.67 billion to USD 8.70 billion as of mid-November, 2019 as against USD 7.02 billion in November, 2018.
On the BoG inter-bank trading platform, the Cedi depreciated by 0.05% to begin the week trading at GHC 5.5396 from previous week’s trade value of GHC 5.5368. It, however, gained momentum to post 1.16% and 0.37% appreciation against the Pound and the Euro respectively. It traded at GHC 7.1904 and GHC 6.1683 at the start of the week from previous week’s trade values of GHC 7.2748 and GHC 6.1913. The Cedi recovered from previous week’s losses recorded against the Pound on worries of the state of the UK economy after data showed that the UK economy grew at its weakest annual pace in more than seven years in November. The disappointing economic data fueled expectations of rate cuts in 2020.
On the Open Forex Market (oanda.com), the Cedi appreciated by 0.56%, 1.52%, and 1.04% to trade at GHC 5.6881, GHC 7.3965, and GHC 6.3305 from previous week’s trade values GHC 5.7201, GHC 7.5104, and GHC 6.3967 respectively. The greenback lost against the Cedi after a disappointing US non-farm payrolls data. The greenback subsequently lost steam against some of its trading pairs after the release of the jobs data. The data showed that US jobs increased by 145,000 in December, failing to meet 164,000 expectations.
According to the Bank of Ghana inter-bank rates, the Ghanaian Cedi began 2020 at GHC 5.5370 [January 2nd, 2020] against the US Dollar and is currently selling at GHC 5.5396 [January 13th, 2020] indicating a 0.05% year-to-date depreciation. Similarly, on the Open Forex Market (oanda.com), the Ghanaian Cedi traded at GHC 5.6961 [January 2nd, 2020] and is currently trading at GHC 5.6881 [January 13th, 2020], representing a 0.14% year-to-date appreciation of the Cedi against the US Dollar.