Source: newsthemegh.com
On the commercial forex market, the depreciation of the Ghanaian cedi versus the US dollar is still increasing; in the first four months of 2024, the value loss of the cedi approached 10%.
The cedi has depreciated somewhat since the year began, for a total depreciation of roughly 9.37% as of this writing.
In comparison to the 22.73% depreciation reported as of April 2023, this is a notable decrease.
Compared to GHS 11.55 at the same period last year, commercial banks are reporting an all-time high exchange rate of GHS 13.055 to the dollar.
With rates of 1.69%, 0.98%, and 1.77% for January, February, and March 2024, respectively, data from the Bank of Ghana shows a persistent depreciation trend despite initiatives including new dollar inflows and currency auctions to Bulk Oil Distribution Companies (BDCs).
Some analysts believe that the cedi’s decline might be reversed in the first half of the year, but others are concerned about how it would affect inflation.
The Bank of Ghana intends to auction $120 million to BDCs in the second quarter of 2024 in an effort to stabilize the cedi, yet obstacles may arise due to firms’ ongoing desire for dollars.
Notwithstanding the preservation of the policy rate at 29% and lending rates that average more than 32%, worries about currency volatility continue. Nonetheless, Dr. Ernest Addison, the governor of the Bank of Ghana, voiced optimism during the most recent meeting of the Monetary Policy Committee, pointing to robust reserves from increased remittance inflows as a safety net for the local currency in the months ahead.