Currency News for May 17th 2021

After the latest consumer price index reading showed that price levels were inching towards pre-COVID levels, the Cedi at the start of the week posted strong gains against its three major trading partner currencies on the Bank of Ghana (BoG) inter-bank trading platform. The Cedi, however, came under pressure on the Open Forex Market (oanda.com) as it registered losses against the US Dollar, the British Pound Sterling, and Euro.

The Cedi’s outlook remains strong as it has so far maintained a positive year-to-date performance against the Dollar and the Euro on both the BoG inter-bank trading platform and the Open Forex Market. Ghana’s strong Gross International Reserve which stood at USD 8.72 billion (4.2 months of import cover) [excluding proceeds from Ghana’s Eurobond sale] as of end-February should enable the central bank to continue to support the local currency in the event of demand shocks.

On the BoG inter-bank trading platform, the Cedi soared by 0.01%, 0.09%, and 0.04% to open the week trading at GHC 5.7334, GHC 8.0972, and GHC 6.9654 from previous week’s opening trade values of GHC 5.7340, GHC 8.1044, and GHC 6.9685 against the Dollar, the Pound, and the Euro respectively. The Cedi rose marginally against the Dollar following the emergence of risk appetite. News that US inflation had climbed up beyond expectations failed to sustain the greenback’s gains after the Fed noted that the recent inflationary pressures were only transitory.

On the Open Forex Market (oanda.com), the Cedi depreciated by 0.10%, 0.22%, and 0.03% to trade at GHC 5.7754, GHC 8.1503, and GHC 7.0156 at the start of the week from previous week’s trade value of GHC 5.7699, GHC 8.1328, and GHC 7.0136 against the Dollar, the Pound, and the Euro respectively. The Pound gained against most of its trading pairs after March UK GDP figures came in stronger than expected whilst manufacturing activities also picked up steam.

According to the Bank of Ghana inter-bank rates, the Ghanaian Cedi began the year 2021 at GHC 5.7631 [January 4th, 2021] against the US Dollar and is currently selling at GHC 5.7334 [May 17th, 2021] indicating a 0.52% year-to-date appreciation. Similarly, on the Open Forex Market (oanda.com), the Ghanaian Cedi traded at GHC 5.8885 [January 4th, 2021] and is currently trading at GHC 5.7754 [May 17th, 2021], representing a 1.92% year-to-date appreciation of the Cedi against the US Dollar.