Currency News for August 17th 2020

The Ghanaian Cedi fell across the board against its three major trading partner currencies on the Bank of Ghana (BoG) inter-bank trading platform after the government failed to raise its intended GHC 1,000 million through a 7-year fixed-rate bond from both offshore and domestic investors. On the Open Forex Market (oanda.com), the Cedi was mixed against the three as it built on previous week’s gains against the US Dollar and the Pound but lost traction against the Euro.

Aggressive interest by offshore investors in local bonds issued by the government has traditionally signaled strong investor confidence in the Ghanaian economy. However, with total bids tendered for the 7-year fixed-rate bond coming in at GHC 590.33 million despite a significant rise in the yield from its last issuance, it showed investors maintaining a cautious stance in the local economy in the face of the coronavirus pandemic.

On the BoG inter-bank trading platform, the Cedi depreciated by 0.02%, 0.15%, and 0.89% to trade at GHC 5.6837, GHC 7.4457, and GHC 6.7449 at the start of the week from previous week’s trade values of GHC 5.6824, GHC 7.4343, and GHC 6.6856 against the Dollar, the Pound, and the Euro respectively. The Pound recorded its seventh weekly gain against the Cedi as signs of economic recovery in June provided support for the Pound after the UK economy shrank by 20.4% in the second quarter.

On the Open Forex Market (oanda.com), the Cedi appreciated by 0.30% and 0.07% to begin the week trading at GHC 5.7722 and GHC 7.5618 from previous week’s trade values of GHC 5.7897 and GHC 7.5668 against the Dollar and the Pound respectively. The Cedi added onto previous week’s gain against the Dollar as the impasse between US lawmakers about an additional US stimulus package to help cope with the pandemic continues to weigh on the greenback. Against the Euro, the Cedi erased previous week’s gain against the single currency as it fell by 0.49% to trade at GHC 6.8461 at the start of the week from GHC 6.8125 traded last week.

According to the Bank of Ghana inter-bank rates, the Ghanaian Cedi began the year 2020 at GHC 5.5370 [January 2nd, 2020] against the US Dollar and is currently selling at GHC 5.6837 [August 17th, 2020] indicating a 2.65% year-to-date depreciation. Similarly, on the Open Forex Market (oanda.com), the Ghanaian Cedi traded at GHC 5.6961 [January 2nd, 2020] and is currently trading at GHC 5.7722 [August 17th, 2020], representing a 1.33% year-to-date depreciation of the Cedi against the US Dollar.