Currency News for April 27th 2020

The Ghanaian Cedi, at the start of the week, fell across the board against its three major trading partner currencies on both the Bank of Ghana (BoG) inter-bank trading platform and on the Open Forex Market (oanda.com) despite the latest economic data showing that the local economy grew by 6.5% in 2019, its second-highest since the 2017 rebasing of the economy. According to figures released by the Ghana Statistical Services, the value of all economic activities in 2019 rose to GHC 164.56 billion from GHC 154.55 billion in 2018.

The Cedi’s performance this week comes after the World Bank projected that global remittances may declines sharply by almost 20% in 2020 as a result of the economic impact of the COVID-19 on the income levels of migrants. Remittances to low and middle-income economies for the year are expected to decline by USD 445 billion representing a fall of 19.7%. Foreign currency generated from remittances plays a key role in sustaining the Cedi. In 2018, a total of USD 3.00 billion was remitted into Ghana.

On the BoG inter-bank trading platform, the Cedi continued to nurse losses against the US Dollar as it erased all its 2020 gains against the greenback. It lost by 0.60%, 0.32%, and 0.29% to trade at GHC 5.5507, GHC 6.8934, and GHC 6.0146 at the start of the week from previous week’s trading values of GHC 5.5176, GHC 6.8716, and GHC 5.9972 against the Dollar, the British Pound Sterling, and the Euro respectively. The Dollar gained against many of its trading partner currencies as investors fled riskier assets and currencies amid a slump in oil prices.

On the Open Forex Market (oanda.com), the Cedi depreciated by 0.76%, 0.44%, and 0.48% to begin the week trading at GHC 5.8011, GHC 7.2047, and 6.2859 from previous week’s trading figures of GHC 5.7574, GHC 7.1733, and GHC 6.2561 against the Dollar, the Pound, and the Euro respectively. The Cedi failed to build on previous week’s gain against the Pound despite projections that the UK could experience its worst recession in 300 years as the impact of the pandemic weighs down the UK economy.

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 5.5507 [April 27th, 2020] indicating a 0.25% 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 5.8011 [April 27th, 2020], representing a 1.84% year-to-date depreciation of the Cedi against the US Dollar.