The woes of the Ghana cedi continued unabated as the local currency is going or ¢11.30 to a dollar in the retail market.
This is coming after it breached the ¢11 mark on Saturday October 8, 2022.
Checks by Joy Business in some forex bureaus within the capital, Accra, indicate that most forex bureaus are selling a dollar for between ¢11.10 and ¢11.35.
The same could be said about the euro and pound which are also trading very high against the cedi. The cedi is going for ¢12.30 and ¢10.83 against the pound and euro respectively.
The situation if not given urgent attention by managers of the economy may be dire for the economy as most businesses have seen a significant increase in their cost of doing business, whilst households have also witnessed substantial rise in their cost of living.
Some of the forex bureaus operators who spoke to Joy Business on condition of anonymity emphasised the recent action by Bank of Ghana against them as ineffective since the problem is more of an economic issue.
However, some analysts are cautiously optimistic that the $1.13 billion cocoa syndicated loan which the first tranche is expected to come in by the end of this month will help improve supply and slow down the rate of depreciation of the currency.
But that is a temporary measure which will be short-lived if medium to long term measures are not implemented.
Finance Minister, Ken Ofori-Atta, yesterday October 12, 2022 met with the Director for the Africa Department of the IMF, Abebe Aemro Selassie at the ongoing Annual IMF/World Bank Spring Meetings to push for a quick completion of negotiations with the International Monetary Fund for an economic programme.
The IMF move is seen by many as the only measure that will restore Ghana’s macroeconomic and structural challenges.
Though it will come with painful conditionalities, many market watchers believe it will boost the country’s credibility and improve its credit rating, following downgrades by Moody’s and Fitch.
Dollar breaks ¢11 mark; forex bureaus sell a dollar for ¢11.2
The dollar broke the ¢11 mark over the weekend, following days of consecutive fall.
Also a report by Databank Research disclosed that the cedi was likely to endure depreciation pressures in the near term as the foreign exchange market still awaits news on the Debt Sustainability Analysis [DSA] conducted by the IMF
“The local unit [cedi] is likely to endure depreciation pressures in the near term as the market still awaits news on the DSA conducted by the IMF. The syndicated loan of $1.13 billion signed last week is expected to bolster FX supply and provide some reprieve to the cedi”, Databank Research said.
As portfolio outflows drained reserves, Ghana’s gross international reserves fell to 2.9 months of import cover. This is despite impressive earnings from exports of crude oil and gold.