Currency News [March 13, 2023]

The Ghanaian Cedi traded higher at the week’s open against its three major trading partner currencies on the Open Forex Market (oanda.com) following the president’s assurance at the State of the Nation Address to parliament last week that Ghana was on course to reach an agreement with bilateral lenders in the sovereign’s quest to bag a USD 3.0 billion IMF bailout. On Friday, the local currency rose to its highest in nearly four weeks on the Open Forex Market before giving up some of its gains to open the week at a 3-day low against the set of three.

Analysts assert that the president’s comments about the progress of Ghana’s negotiations with its external creditors helped calm down the market, improving confidence in the local economy and the Cedi. The Cedi’s strength has also been supported by a blend of improved forex liquidity and slowing forex demand as calm gradually creeps into the local forex space. Last week, the Bank of Ghana (BoG) sold USD 7.0 million on the spot market against USD 5.2 million in the previous week.

On the BoG inter-bank trading platform, the Cedi opened the week unchanged from last week’s opening quote of GHS 11.0191 against the Dollar. Against the Pound and the Euro, the Cedi lost by 2.14% and 1.21% to begin the week trading at GHS 13.3937 and GHS 11.8246 from last week’s opening trade quotes of GHS 13.1127 and GHS 11.6838 respectively. The Euro recovered from its earlier loss against the local unit on the back of growing expectations that the European Central Bank will hike the bloc’s interest rates by 0.5% after the latest inflation numbers pointed to underlying price pressures remaining elevated.

On the Open Forex Market (oanda.com), the Cedi was up by 2.68%, 1.87%, and 2.17% to open the week trading at GHS 12.4135, GHS 15.0553, and GHS 13.2980 from last week’s opening trade quotes of GHS 12.7554, GHS 15.3420, and GHS 13.5936 against the Dollar, the Pound, and the Euro respectively. Signs of stress in the US financial system following the collapse of two big US regional banks caused a sharp reappraisal of the outlook for interest across the US, causing the Dollar to nurse losses against a basket of currencies including the Cedi.

The Cedi was quoted at GHC 8.5903 on the first trading day of the year against the Dollar and is currently being sold at GHS 11.0191 indicating a year-to-date (YTD) loss of 28.27% on the BoG inter-bank trading platform. It is also presently being quoted at GHS 12.4135 on the Open Forex Market (oanda.com) after opening the year at GHS 10.0825 indicating a YTD loss of 23.12%.