Currency News [June 12, 2023]

The Ghana Cedi remained pressured at the week’s open against its three major trading partner currencies on both the Bank of Ghana (BoG) inter-bank trading platform and the Open Forex Market (oanda.com) where it nursed losses against the Dollar, the Pound, and the Euro. The Cedi’s weakened performance comes despite an upgrade of the local currency long-term issuer rating to Caa3 from Ca by Moody’s with the rating organization maintaining the stable outlook.

Moody’s in a report published last week noted that following the completion of the domestic debt restructuring programme, its assessment of future expected losses on Cedi debt had diminished. According to the rating agency, the Caa3 captured elevated re-default risk, which remains substantial until Ghana completely restructures all its Cedi-denominated debt and until the foreign currency debt is similarly restructured. The upgrade, however, will be expected to reinforce the Cedi’s stable outlook following the optimism surrounding Ghana’s Extended Credit Facility programme with the IMF.

On the BoG inter-bank trading platform, the Cedi traded lower by 0.04%, 0.53%, and 0.40% from last week’s opening trade values of GHS 10.9775, GHS 13.6472, and GHS 11.7567 to open this week trading at GHS 10.9822, GHS 13.7189, and GHS 11.8043 against the Dollar, the Pound, and the Euro respectively. The Dollar recovered from its last week loss against the Cedi, boosted by expectations that the US Fed will hike rates at its July sitting, although a rate pause is expected this month.

On the Open Forex Market (oanda.com), the Cedi plunged by 0.58%, 1.61%, and 1.09% to open the week at trade values of GHS 11.3897, GHS 14.2906, and GHS 12.2516 from last week’s open trade quotes of GHS 11.3237,GHS 14.0640, and GHS 12.1189 against the Dollar, the Pound, and the Euro respectively. The Euro traded higher against a set of currencies including the Cedi as the market shifted its focus from news that the Eurozone economy was in a technical recession to an addition 0.25% rate hike at the central bank’s meeting due later this week.

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 10.9822 indicating a year-to-date (YTD) loss of 27.84% on the BoG inter-bank trading platform. It is also presently being quoted at GHS 11.3897 on the Open Forex Market (oanda.com) after opening the year at GHS 10.0825 indicating a YTD loss of 12.97%.