Currency News for February 14, 2022

The Cedi weakened across the board against its three major trading partner currencies as it began the week adding onto previous weeks’ losses. The Cedi’s woes according to some analysts has further been worsened by the activities of speculators seeking to take advantage of the recent pressures on the local unit which is expected to persist through the first half of the year.

Key underlying risks to Ghana’s economy as the nation grapples with high public debt stock, revenue underperformance, rising expenditures, and growing inflationary pressures is driving a general selloff in Ghanaian assets held by offshore investors amid rising import bills. The latest forex forward rates auction results showed that bids came in excess of 3.9 times the offer amount. It is expected that pressures on the local unit will continue to linger as investor sentiments remain dampened.

On the Bank of Ghana (BoG) inter-bank trading platform, the Cedi plunged by 2.31%, 2.20%, and 1.09%, being quoted at GHS 6.3053, GHS 8.5203, and GHS 7.1293 at the start of the week from last week’s opening quotes of GHS 6.1629, GHS 8.3365, and GHS 7.0523 against the Dollar, the Pound, and the Euro respectively. The Dollar posted its fourth weekly gain against the Cedi this week after US inflation rose to 7.5% in January, the highest in four decades, lifting expectations of aggressive rate hikes.

On the Open Forex Market (oanda.com), the Cedi traded lower by 1.20%, 1.24%, and 0.20%, beginning the week trading at GHS 6.4891, GHS 8.7810, and GHS 7.3475 from last week’s opening trade values of GHS 6.4122, GHS 8.6735, and GHS 7.3330 against the Dollar, the Pound, and the Euro respectively. Data showing that the UK economy expanded by 7.5% in 2021 boosted the Pound’s appeal as investors remained hopeful that the UK is on track to economic recovery.

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 6.3053 indicating a year-to-date (YTD) loss of 4.93% on the BoG inter-bank trading platform. It is also presently being quoted at GHS 6.4891 on the Open Forex Market (oanda.com) after opening the year at GHS 6.2112 indicating a YTD depreciation of 4.47%.