The local currency
THE CEDI hit a fresh record low 14.54 before recovering slightly to 14.50, compared to 14.43 recently.
President Akufo-Addo this week fired his Minister of State Charles Adu Boahen over allegations related to the corruption but negative sentiment continues to plague the Cedi, with a potential US$3 billion IMF bailout remaining elusive and uncertainty around Ghana’s 2023 budget as well as surging inflation—currently at 40.4%. These add to the currency’s malaise.
AZA Finance, which discloses this in its latest update, said the Bank of Ghana sold $60 million onto the market in its forward forex auction, but that did little to stem the Cedi’s losses. With demand for foreign exchange elevated ahead of the festive season, analysts expect the local currency to weaken beyond the 15 level.
Last week, it said the Cedi hit a record dollar low, sliding to 14.24 on Tuesday from 13.71 at the close of the week, before recovering slightly to 14.20.
The round of stress came after the Bank of Ghana cancelled a planned forex auction, causing the currency to spike.
The Central Bank has been taking a range of measures to stem the currency’s year-long spiral, including an unsuccessful crackdown on unlicensed currency sellers.
It has also been buying dollars directly from mining companies to shore up its reserves, starving the market of much needed liquidity. The local currency was expected to remain under pressure in the near term, possibly weakening beyond the 14.50 level.