Rate of cedi depreciation slows as market project relative stability

The
Ghana
Cedi
recorded
a
marginal
depreciation
as
it
lost
0.58
percent
against
the
US
Dollar
last
week,
although
analysts
project
it
to
remain
stable
this
week
as
foreign
exchange
liquidity
improves.

Many
had
high
expectations
that
the
inflow
of
$360
million
from
the
International
Monetary
Fund
would
immediately
stabilise
the
local
currency.
However,
the
stabilisation
process
is
on
a
gradual
trajectory
as
corporate
demand
begins
to
moderate.

In
the
retail
market,
the
Cedi
ended
the
first
half
of
the
year
losing
approximately
22
percent
against
the
US
Dollar.

Week-on-week,
the
local
currency
shed
1.85
percent
and
1.61
percent
against
the
British
Pound
and
Euro,
respectively.

Meanwhile,
the
Bank
of
Ghana
will
be
selling
$120
million
to
Bulk
Oil
Distributors
through
its
auction
programme
for
the
third
quarter
of
this
year.
Analysts
believe
this
will
further
strengthen
the
local
currency
as
we
navigate
the
second
half
of
the
year.
The
same
amount
was
sold
to
these
firms
in
the
second
quarter
of
the
year.

Additionally,
the
Bank
of
Ghana
is
expected
to
continue
its
measures
aimed
at
addressing
excess
liquidity
in
the
market.

Some
analysts
believe
that
the
IMF
programme
has
restricted
the
Bank
of
Ghana
in
terms
of
its
dollar
market
interventions
as
they
hope
that
the
macroeconomic
environment
will
continue
to
gain
momentum
to
cushion
the
strength
of
the
cedi.

At
the
end
of
the
trading
day
on
Tuesday,
July
9,
a
dollar
was
going
for
GH¢15.65
at
some
forex
bureaus.




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