Currency News [May 15, 2023]

News that Ghana had officially secured financing assurances from the Paris Club, a crucial step towards the sovereign attaining an IMF Executive Board approval, boosted confidence in the Ghanaian economy, with the Cedi seen clawing back some of its recent declines. Subsequently, the Cedi registered gains against its three trading major partner currencies on the Open Forex Market (oanda.com). On the Bank of Ghana (BoG) inter-bank trading platform, the Cedi edged up against the Pound and the Euro but failed to replicate similar gains against the Dollar.

The financial assurances given by the group of bilateral lenders put Ghana on the verge of securing a USD 3.0 billion bailout from the IMF to harness the country’s balance of payment difficulties. According to reports, Ghana is expected to receive USD 1.2 billion this year under the IMF-supported programme, with the first tranche of USD 600.0 million expected this month. This should help strengthen the Cedi’s outlook as these inflows comes in to shore up Ghana’s fast-depleting forex reserves.

On the BoG inter-bank trading platform, the Cedi fell by 0.08% to trade at GHS 10.9690 at the week’s open from GHS 10.9603 at last week’s open. Against the Pound and the Euro, the Cedi edged up by 0.85% and 1.30% to open the week at trade values of GHS 13.7342 and GHS 11.9273 from last week’s opening trade quotes of GHS 13.8527 and GHS 12.0847 respectively. The Pound fell against a set of currencies after an unexpected 0.3% sharp drop in the UK’s economic growth rate in March moderated the first quarter growth rate to print at 0.1%.

On the Open Forex Market (oanda.com), the Cedi inched up by 1.01%, 2.10%, and 2.42% to trade at GHS 11.7474, GHS 14.6828, and GHS 12.7703 at the week’s opening from last week’s opening trade values of GHS 11.8671, GHS 14.9982, and GHS 13.0868 against the Dollar, the Pound, and the Euro respectively. The Dollar weakened against some of its peers over concerns that political dispute over the US debt ceiling could trigger a recession.

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 10.9690 indicating a year-to-date (YTD) loss of 27.69% on the BoG inter-bank trading platform. It is also presently being quoted at GHS 11.7474 on the Open Forex Market (oanda.com) after opening the year at GHS 10.0825 indicating a YTD loss of 16.51%.