Currency News for January 24, 2022

The Ghana Cedi was mixed against its three major trading partner currencies as it began the week extending its losses against the Dollar but found support to recover some of its losses against the Pound and the Euro. The Cedi managed to slow down its rate of decline experienced over the past few weeks after the finance ministry detailed plans it tends to carry out to sustain the local economy from undergoing structural challenges after Fitch’s downgrade.

The Cedi’s performance this week comes in the wake of Ghana’s dollar-denominated bonds dropping further into distressed territories with majority of the nation’s outstanding bonds now trading with spreads wider than 10 percentage points. In the periods ahead, we expect the government to use the sale of domestic bonds to woo foreign currency inflows as rates on medium to longer-term securities picks up momentum.

On the Bank of Ghana (BoG) inter-bank trading platform, the Cedi edged down by 0.08% to open the week at GHS 6.0139 from last week’s opening quote of GHC 6.0093. The Dollar gained as geopolitical tensions between Russia and the West over Ukraine added a layer of support for safe-havens. Against the Pound and the Euro, the Cedi recorded its first weekly gain against the two in 2022 as it climbed up by 1.42% and 0.88% to trade at GHS 8.0863 and GHS 6.7929 at the start of the week from GHS 8.2027 and GHS 6.8533 quoted at last week’s open.

On the Open Forex Market (oanda.com), the Cedi nudged down by 0.65% after it traded at GHS 6.3131 at the beginning of the week from last week’s opening trade value of GHS 6.2721. Disappointing retail data and purchasing managing index in the UK and the Eurozone sent the Pound and the Euro tumbling against most of its trading pairs with the Cedi also recording gains against the two. The Cedi was up by 0.48% and 0.14%, from GHS 8.5698 and GHS 7.1583 recorded last week to GHS 8.5289 and GHS 7.1479 against the Pound and the Euro respectively.

The Cedi was quoted at GHC 6.0091 on the first official trading day of the year against the Dollar and is currently being sold at GHS 6.0139 indicating a year-to-date (ytd) loss of 0.08% on the BoG inter-bank trading platform. It is also presently being quoted at GHS 6.3131 on the Open Forex Market (oanda.com) after opening the year at GHS 6.2112 indicating a ytd depreciation of 1.64%.