Currency News [October 31, 2022]

The ongoing rapid and sharp fall in the value of the Ghanaian Cedi against its major trading partner currencies took a much calmer tone as the Cedi opened the week posting moderate losses compared to the rates of depreciation sustained over the past few weeks. The Cedi posted relative stability at the week’s open after authorities began a series of engagements aimed at curbing currency speculation and restoring confidence in the local unit.

Last week saw the Governor of the Bank of Ghana (BoG) meet with the Ghana Association of Banks and the Forex Bureaus Association to discuss strategies for sanitizing the forex space. Ghana’s president later met with key stakeholders such as the Association of Ghana Industries among others to discuss measures to boost the domestic economy and investor interest. We foresee that this series of public engagements coupled with the coming on board of the first tranche of cocoa syndicated loan will in the short to medium term improve the Cedi’s outlook.

On the BoG inter-bank trading platform, the Cedi traded down by 3.79%, 5.56%, and 3.82% to begin the week trading at GHS 13.0151, GHS 14.9622, and GHS 12.8674 from last week’s opening trade values of GHS 12.5400, GHS 14.1739, and GHS 12.3941 against the Dollar, the Pound, and the Euro respectively. The Dollar added to its previous weeks’ gains against the Cedi on growing expectations of another supersized rate increase at this week’s Fed monetary policy meeting.

On the Open Forex Market (oanda.com), the Cedi was down by 4.59%, 6.66%, and 5.27% to trade at GHS 14.1443, GHS 16.3145, and GHS 14.0288 at the week’s open compared to last week’s opening quotes of GHS 13.5238, GHS 15.2956, and GHS 13.3268 against the Dollar, the Pound, and the Euro respectively. The Euro gained against a host of currencies including the Cedi after the European Central Bank raised its deposit rate by 0.75% to 1.5%, the highest in nearly fifteen years with further interest rate hikes expected.

The Cedi was quoted at GHC 6.0091 on the first trading day of the year against the Dollar and is currently being sold at GHS 13.0151 indicating a year-to-date (YTD) loss of 116.59% on the BoG inter-bank trading platform. It is also presently being quoted at GHS 14.1443 on the Open Forex Market (oanda.com) after opening the year at GHS 6.2112 indicating a YTD loss of 127.72%.