Currency News for April 14th 2020

The Ghanaian Cedi at the start of the first trading day of the week fell across the board against its three major trading partner currencies as investors continue to seek solace in safe-haven assets and currencies amid growing concerns in financial markets that the coronavirus pandemic is far from over. As Ghanaian authorities implement measures in an attempt to contain the spread of the COVID-19 pandemic, there are fears that the government will overspend its budget as revenues are projected to remain weak.

The central bank’s recent forex forward auctions revealed that demand for forex continues to surge. Total bids tendered for various the tenors were over 3 times larger than the bank’s target amount of USD 25.00 million. Despite the strong demand at USD 78.75 million, the central sold its target amount. As Ghana prepares to receive USD 1.00 billion under the IMF’s Rapid Credit Facility, it is expected these funds will give the central bank space to continue to support the local currency.

On the Bank of Ghana (BoG) inter-bank trading platform, the Cedi dipped by 0.18%, 2.63%, 1.52% to trade at GHC 5.5133, GHC 6.9406, and GHC 6.0411 at the start of the week from previous week’s trade values of GHC 5.5035, GHC 6.7626, and GHC 5.9504 against the US Dollar, the British Pound Sterling, and the Euro respectively. The Cedi continue to erase recent gains recorded against the Dollar as investors scramble for the hard currency despite a significant rise in the number of Americans seeking unemployment benefits.

On the Open Forex Market (oanda.com), the Cedi tumbled by 0.41%, 2.98%, and 1.82% to begin the week trading at GHC 5.8348, GHC 7.3415, and GHC 6.3928 from previous week’s trading figures of GHC 5.8112, GHC 7.1291, and GHC 6.2786 against the Dollar, the Pound, and the Euro respectively. The Pound rose this week against many of its trading pairs on news that the Bank of England had agreed to lend funds to the government to fight the pandemic if funds cannot be immediately accessed from the debt market.

According to the Bank of Ghana inter-bank rates, the Ghanaian Cedi began the year 2020 at GHC 5.5370 [January 2nd, 2020] against the US Dollar and is currently selling at GHC 5.5133 [April 14th, 2020] indicating a 0.43% year-to-date appreciation. 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 5.8112 [April 14th, 2020], representing a 2.43% year-to-date depreciation of the Cedi against the US Dollar.