26.1 C
Accra
Sunday, May 26, 2024
BusinessGhana cedi faces continues depreciation amid corporate demand and economic factors

Date:

Ghana cedi faces continues depreciation amid corporate demand and economic factors

spot_img

The Ghana cedi is expected to face further depreciation against major trading currencies this week due to persistent corporate demand, as noted by currency analysts and traders who requested anonymity.

They attribute the cedi’s weakened performance to both internal and external factors, including the strengthening US dollar against Emerging Markets currencies.

- Advertisement -

April 2024 witnessed a slight decrease in inflation to 25% year-on-year from March 2024’s rate of 25.8%, largely driven by a reduction in food inflation to 26.8%.

Some analysts anticipate potential inflationary pressures, which could stimulate additional speculative demand for the US dollar, consequently weakening the cedi. The cedi has been among the worst-performing currencies globally this year.

- Advertisement -

Moreover, the upcoming announcement of April 2024 inflation by the US Federal Reserve may provide insights into the Fed’s policy rate trajectory during the June 24, 2024, meeting.

Recent US data also revealed a rise in unemployment benefit claims last week to the highest level in eight months.

- Advertisement -

These developments suggest a slowdown in consumer demand, likely attributed to a tight labor market, which could alleviate inflationary pressures, thereby easing the challenges faced by the cedi to some extent.

Cedi depreciates by 17.32% to dollar

Despite the Central Bank’s sale of an estimated $23 million on the spot market last week, the local currency experienced significant depreciation against major trading currencies.

On the retail foreign exchange market, the cedi depreciated by 2.89% week-on-week against the dollar (-17.32% year-to-date) and weakened against the Euro (-3.52% week-on-week; -15.20% year-to-date) and pound (-3.03% week-on-week; -16.63% year-to-date).

Currently, the cedi is being traded at GH¢14.90 at forex bureaus, while the Bank of Ghana quotes one US dollar to GH¢13.01.

Latest stories

I date intelligence and funny men – Tems

Grammy-winning Nigerian singer Temilade Openiyi has shared that she...

Ghanaian jailed 48 months in US for involvement in $3.8m romance scam

A Ghanaian national, Emmanuel Quamey, has been sentenced to...

Rooney given Plymouth Argyle head coach role

Plymouth Argyle, a Championship side, has appointed former England...

Ghana witnessed 2.9% GDP growth in 2023 – Amin Adam

During the Ministry of Finance's monthly briefing on Friday,...

Related stories

Ghana witnessed 2.9% GDP growth in 2023 – Amin Adam

During the Ministry of Finance's monthly briefing on Friday,...

Govt and Tullow Oil approve US$90million emissions reduction deal

Tullow Oil plc has unveiled a financial commitment of...

Cedi has experienced a 14.2% depreciation in 2024 – Amin Adam

Finance Minister, Dr. Mohammed Amin Adam has indicated that...

Cedi will be stable in medium-term after completion of DDEP – Finance minister

Finance Minister Dr. Mohammed Amin Adam has noted that...

Ghana’s Energy Transition Framework aims for net-zero emissions by 2070 – Deputy Energy Minister

Deputy Energy Minister, Collins Adomako-Mensah has unveiled an ambitious...

Govt commits GHS2.3bn to NIB restructuring and recapitalization

The government has approved GH¢2.3 billion for the restructuring...

Govt set to introduce SME training initiatives – Finance minister

The government has announced plans to enhance support for...

LEAVE A REPLY

Please enter your comment!
Please enter your name here