Cedi Depreciates About 12% in Value to Dollar in Just 4 Days of last Week

The Ghana cedi has lost about 12% in value to the US dollar in a stretch of days this week (October 16-October 20, 2022).

The cedi now sells about ¢13.75 to the US dollar less than a day, after reaching ¢13 on October 19.

Most forex bureaux sold the local currency between ¢12.50 and ¢12.95 to the dollar on October 19, 2022.

This is a sharp decrease from the depreciated 2% on Monday, October 16 from ¢11.04 to ¢11.2625 per dollar (interbank), taking its losses this year to 45.1%, the most among 148 currencies tracked by Bloomberg.

This is a result of the investment market reacting negatively to the September 2022 inflation (37.2%).

The cedi is selling at about ¢14.05 to the pound and ¢12.10 to the euro.

The year-to-date depreciation rate is, therefore -45.46%.

Analysts say the cedi came under sustained selling pressure last week on heightened uncertainty as the September 2022 inflation surprisingly came in at 37.20%.

They expect the selling pressures to persist on heightened uncertainty around the cedi.

In the 14th Forex Forward auction for the

Bulk Oil Distribution Companies, the Bank of Ghana allocated $60 million at a 30-day forward rate of ¢10.7907 to a dollar, indicating intense demand pressures.

In Accra, reports indicate that there is an acute shortage of US dollars and a number of the banks do not have enough dollars to undertake forex transfers and other related businesses.

The free fall of the cedi has already triggered protests by some traders who claim their cost of doing business has been surging every week.

Some Financial analyst has stated that the free fall of the cedi to the dollar has triggered hoarding of the US dollar, thus intensifying demand for the American ‘greenback’.

1 dollar now goes for ¢13.75

Cedi slumps to the world’s worst performer versus dollar

The depreciation pressures on the cedi caused a slump in the local currency, ranking it as the world’s worst-performing currency to the dollar, according to Bloomberg.

The currency of the world’s second-biggest cocoa producer depreciated 2% on Monday to 11.2625 per dollar (interbank), taking its losses this year to 45.1%, the most among 148 currencies tracked by Bloomberg.