Currency News for November 9th 2020

News of a potential vaccine for the novel coronavirus boosted appetite for risky currencies and assets after US drug maker Pfizer and German partner BioNTech announced that a large-scale clinical trial showed their vaccine was over 90% effective in preventing COVID-19. The Ghanaian Cedi halted 6 weeks of consecutive weekly losses against the US Dollar as it remained unchanged at the start of the week on the Bank of Ghana (BoG) inter-bank trading platform. On the Open Forex Market (oanda.com), the local currency rose marginally to recover some of previous weeks’ losses against the Dollar.

The Cedi, however, lost traction against the British Pound Sterling and the Euro on both trading platforms after posting a resilient performance last week. The Cedi remains susceptible to demand pressures as importers increase their demand for forex ahead of the yuletide. Recent BoG forex forward rate auction results showed that demand for Dollars came in 3.34 times the offer amount, up from an average of 2.64 times bid cover in September.

On the BoG inter-bank trading platform, the Cedi stayed at GHC 5.7139 against the Dollar. Against the Pound and the Euro, the Cedi depreciated by 2.10% and 1.98% to trade at GHC 7.5280 and GHC 6.7789 at the start of the week from previous week’s trade values of GHC 7.3732 and GHC 6.6473 respectively. The Pound gained against most of its trading pairs as news of the potential vaccine restored confidence in the UK economy that is already heading for a new lockdown amid a resurgence in coronavirus infections.

On the Open Forex Market (oanda.com), the Cedi strengthened by 0.01% to begin the week trading at GHC 5.8337 from GHC 5.8343 posted last week. The greenback fell against a host of trading pairs after Joe Biden was projected to be the next president of the United States. A Biden presidency is expected to shore up international trade through steady policies. The Cedi weakened by 1.95% and 1.91%, trading at GHC 7.6804 and GHC 6.9204 at the start of the week from previous week’s trade values of GHC 7.5335 and GHC 6.7904 against the Pound and the Euro respectively.

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 5.7139 [November 9th, 2020] indicating a 3.19% 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 5.8337 [November 9th, 2020], representing a 2.42% year-to-date depreciation of the Cedi against the US Dollar.