Currency News [March 25, 2024]

The Cedi’s woes intensified at this week’s opening where the local currency fell across the board against its three major trading partner currencies on the Bank of Ghana (BoG) inter-bank trading platform and the Open Forex Market (oanda.com). The Cedi’s performance comes amidst a monetary policy rate stay on the back of revelations from the latest inflation forecast, suggesting a slightly elevated profile from a probable upward revision in transport fares, an adjustment in utility tariffs, and some pass-through of exchange rate depreciation among others.

Commenting on the Cedi’s recent struggles, the governor of the central bank noted that the Cedi’s vulnerabilities have largely emanated from the strengthening of the US Dollar on the international market and heavy drawdowns of Ghana’s reserves mainly from payments made for the energy sector. These coupled with delays and uncertainties associated with the second tranche of the cocoa loan inflow and the World Bank’s disbursement of budget support have added to pressures on the Cedi. The central bank, however, remained hopeful that the continued inflows from remittances and mining companies as well as the Domestic Gold Purchase Programme will help sustain the Cedi in the near term.

On the BoG’s inter-bank trading platform, the Cedi was down by 1.46%, 0.76%, and 0.96% to begin the week at trade values of GHS 12.8521, GHS 16.2451, and GHS 13.9240 from last week’s opening trade values of GHS 12.6673, GHS 16.1230, and GHS 13.7921 against the Dollar, the Pound, and the Euro respectively. The Dollar remained broadly strong against most peers following recent economic data which suggested that the US economy remained on a solid footing after unemployment numbers unexpectedly fell last week.

On the Open Forex Market (oanda.com), the Cedi plunged by 1.31%, 0.46%, and 0.76% to open the week trading at GHS 13.1068, GHS 16.5486, and GHS 14.1907 from last week’s opening trade quotes of GHS 12.9372, GHS 16.4727, and GHS 14.0831 against the Dollar, the Pound, and the Euro respectively. The Euro gained against the Cedi despite concerns that the faster pace of deflation in Europe could likely force the European Central Bank to cut rates sooner than its peers.

The Cedi was quoted at GHC 11.8859 on the first trading day of the year against the Dollar and is currently being sold at GHS 12.8521 indicating a YTD loss of 8.10% on the BoG inter-bank trading platform. It is also presently being quoted at GHS 13.1068 on the Open Forex Market (oanda.com) after opening the year at GHS 11.9945 indicating a YTD loss of 9.27%.