In the first 17 days of the new year, the Ghanaian currency would have depreciated by 12.7%, which would make it the second worst performer among the 15 major currencies in sub-Saharan Africa. While one US dollar buys 13.10 cedi units in the parallel market, according to the latest data from the Bank of Ghana, one greenback buys about 10.36 units of the local currency.
The short-lived resurgence of the Cedi
After ending 2022 as one of the worst performing currencies in the world, the Ghanaian currency is already one of two among the top 15 currencies in sub-Saharan Africa that depreciated by double digits in the first 17 days of the new year, according to a report. . The Egyptian pound, which depreciated 16.5% over the same period, is the only currency among the top 15 in sub-Saharan Africa to depreciate faster than the cedi.
Although the Ghana cedi’s 12.7% year-to-date decline is still less than that of all of 2022 (38.86%), the latest depreciation suggests that the currency’s resurgence that began end of 2022 has dissipated.
As reported by Bitcoin.com News in mid-December 2022, the cedi fell from around GHS 14:1 to less than 9:1 in just four days. The currency’s revival had been fueled by reports suggesting that the Ghanaian government had secured a $3 billion loan from the International Monetary Fund (IMF). Ghana needs the loan to help stabilize its economy.
In addition to the IMF loan package, Ghana, one of Africa’s top gold producers, hopes to ease pressure on the cedi through the recently launched gold-for-oil program.
Bank of Ghana exchange rate pic.twitter.com/AGI7GfW5M3
— Bank of Ghana (@thebankofghana) January 20, 2023
However, the cedi’s fall to around GHS 13.10:$1 on the parallel foreign exchange market suggests that neither the IMF loan nor the barter program can stop the currency’s slide. Meanwhile, at the time of writing, the Bank of Ghana Data showed that one US dollar bought 10.36 GHS on the official foreign exchange market.
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