Currency News [December 12, 2022]

The Cedi posted an impressive performance against its three major trading partner currencies on both the Bank of Ghana (BoG) inter-bank trading platform and the Open Forex Market (oanda.com) in what has been tagged as the world’s best-performing currency last week against the Dollar by Bloomberg. The Cedi’s rally has come on the back of rising investor optimism that Ghana and the International Monetary Fund (IMF) will reach a Staff-Level agreement on Tuesday.

An announcement of a Domestic Debt Exchange (DDE) Programme last week set the tone for the Cedi’s recovery as it signaled improved visibility of the local economy’s outlook, helping calm investor nervousness around the local unit and the economy. The DDE programme is aimed at restoring Ghana’s debt sustainability in a bid to secure an IMF bailout. Through the programme, the Ghana government is seeking to exchange 60 domestic assets for four new bonds set to mature in 2027, 2029, 2032, and 2037.

On the BoG inter-bank trading platform, the Cedi traded up by 12.24%, 11.68%, and 12.08% against the Dollar, the Pound and the Euro respectively having risen from GHS 13.1100, GHS 16.0112, and GHS 13.8123 at last week’s open to trade at GHS 11.5058, GHS 14.1417, and GHS 12.1440 respectively at this week’s open. The Dollar fell against the Cedi and a host of other currencies amid concerns that rising interest rates could push the US economy into recession.

On the Open Forex Market (oanda.com), the Cedi edged up by 7.03%, 7.04%, and 7.07% to open the week trading at GHS 13.1738, GHS 16.1482, and GHS 13.8795 against the Dollar, the Pound and the Euro from last week’s opening quotes of GHS 14.1695, GHS 17.3715, and GHS 14.9349 respectively. The Cedi built on its previous week’s gain against the Euro buoyed by growing optimism about the Cedi’s outlook and as the European Central Bank readies to slow down the pace of its aggressive interest rate hikes, having already hiked rates by a total of 200 basis points since the second half of the year.

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 11.5058 indicating a year-to-date (YTD) loss of 91.47% on the BoG inter-bank trading platform. It is also presently being quoted at GHS 13.1738 on the Open Forex Market (oanda.com) after opening the year at GHS 6.2112 indicating a YTD loss of 112.10%.