Currency News [August 26, 2024]

The Cedi opened the week weaker against its three major international trading partner currencies adding to the previous week’s struggles as pressures on the local currency take a new turn after a brief reprieve supported by the disbursement of the USD 360.0 million from the IMF amidst progress made by Ghana in its debt restructuring agreements with international bondholders. The Cedi however is undergoing renewed pressures as fears of limited supply of forex intensify amid an increase in demand for forex.

A recent announcement made by Ghana’s COCOBOD purporting that the local cocoa beans administrative body will not be seeking offshore funding to finance cocoa purchases in the upcoming crop season is already raising concerns of forex inflow shortage as Ghana has widely used proceeds from the cocoa syndicated loans to shore up its forex reserves. This, coupled with fears that Ghana may soon face a probable rise in demand for forex if the nation is forced to increase its importation of food items to supplement the existing supply following the ongoing drought in the northern part of the country is expected to further worsen the Cedi’s outlook.

On the Bank of Ghana (BoG) inter-bank trading platform, the Cedi plummeted by 0.04%, 1.80%, and 0.99% having opened the week at trade values of GHS 15.1441, GHS 19.9962, and GHS 16.9216 from last week’s opening trade quotes of GHS 15.1388, GHS 19.6425, and GHS 16.7556 against the Dollar, the Pound, and the Euro respectively. The Pound edged higher against the Cedi after a slew of stronger-than-expected economic data suggested that the Bank of England need not be in a rush to cut interest rates.

On the Open Forex Market (oanda.com), the Cedi traded up by 0.04% against the Dollar, having begun the week at a trade value of GHS 15.6206 from last week’s opening trade value of GHS 15.6273. The Cedi together with other trading pairs took advantage, of the slowing US economy with growing expectations that the US Fed may begin to cut rates as soon as September, to recover some of its recent losses against the greenback. Against the Pound and the Euro, the Cedi was down by 1.71% and 1.04% to begin the week trading at GHS 20.6155 and GHS 17.4554 from last week’s opening trade quote of GHS 20.2684 and GHS 17.2758 respectively.

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 15.1441 indicating a year-to-date (YTD) loss of 27.38% on the BoG inter-bank trading platform. It is also being quoted at GHS 15.6206 on the Open Forex Market (oanda.com) after opening the year at GHS 11.9945 indicating a YTD loss of 30.23%.