Currency News [June 3, 2024]

The Cedi remained pressured at the week’s opening in line with a recent survey that sought to suggest that emerging market currencies will struggle to rebound this year, pressured by a US central bank that is in no rush to cut interest rates. According to the May 31 to June 4 survey of over fifty forex strategists, nearly all emerging market currencies were forecast to weaken, or at best trade in a range in the next three to six months.

On the domestic front, a revelation by the finance minister that Ghana is near to securing a deal with its Eurobond holders concerning the sovereign’s debt restructuring after substantial progress was made on the new terms for settling the USD 13.0 billion owed to international creditors had barely an impact on the Cedi’s performance against its major trading partner currencies. In addition to other expected inflows, the recently approved 5-year USD 250 million International Development Association credit from the World Bank will likely lessen pressures on the local currency.

On the Bank of Ghana (BoG) inter-bank trading platform, the Cedi fell by 0.89%, 0.98%, and 1.10% to begin the week at trade values of GHS 14.1365, GHS 18.0763, and GHS 15.3828 from last week’s opening trade values of GHS 14.0120, GHS 17.9003, and GHS 15.2149 against the Dollar, the Pound, and the Euro respectively. The Cedi posted a moderate decline against the Dollar this week compared to the previous week after data from the US showed a second straight month of slowdown in manufacturing activity and an unexpected decline in construction spending.

On the Open Forex Market (oanda.com), the Cedi plummeted by 1.57%, 1.59%, and 1.69% to trade at GHS 14.8342, GHS 18.9275, and GHS 16.1216 at this week’s opening from last week’s opening trade quotes of GHS 14.6047, GHS 18.6310, and GHS 15.8534 against the Dollar, the Pound, and the Euro respectively. The Euro edged up against a basket of currencies after data showed price pressures in the Eurozone accelerated faster than expected in May, thus complicating the outlook for the European Central Bank.

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 14.1365 indicating a YTD loss of 18.91% on the BoG inter-bank trading platform. It is also being quoted at GHS 14.8342 on the Open Forex Market (oanda.com) after opening the year at GHS 11.9945 indicating a YTD loss of 23.68%.