Cedi depreciates again; now 5.01 to the US dollar

Ghana’s local currency, the Cedi, has lost grounds against the US dollar in the last week.

According to a report by Joy News, the Cedi’s decline against the US dollar is due to the sudden demand for dollar by businesses in the country to import goods from abroad.

The Ghana Cedi which has been trading around ¢4.80 some two weeks ago has now hit ¢5.01.

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Some financial experts have suggested for the Cedi to gain its value, the Bank of Ghana (BoG) must increase the supply of dollars to meet the rising demand.

The experts say it is only such a move by the central bank that will ease the current pressure and allow the local currency to slightly appreciate and come back to the ¢4 range.

Businesses are expectant that the tight liquidity challenges encountered in 2018 will ease considerably in 2019 because of government’s pledge to pay all arrears owed contractors and suppliers.

In January 2018, Economist Intelligence Unit, a specialist publisher in the UK, projected that the Ghana cedi will hit 6 cedis to a dollar by 2022.

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The Economist Intelligent Unit, which has operated for about 60 years, also warned that the local currency may suffer some external pressures that may cause the cedi to depreciate by 2019.

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Source: YEN.com.gh