According to Research and market information firm, Fitch Solutions, has predicted that the depreciation rate of the Ghana cedi will be lower by the time end of the year.
The Ghana Cedi has been depreciating with speed against the United States dollar. Fitch has predicted the Ghana cedi should be about ¢12.40 to one US dollar, a significant improvement from the 38% depreciation recorded last year.
The research and market information firm’s argument is based on the premise that Ghana will secure an International Monetary Fund-support programme by May 2023 that will go a long way to cushioning the cedi against foreign exchange pressures.
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Should the IMF bailout fail, the Ghana Cedi may depreciate further. What this means is that, the economy is going to be on its knees.
It also added that while short-term exchange rate volatility will persist, it believes the cedi will stabilise once a formal creditors’ committee is formed and the IMF executive board approves Ghana’s programme.
The Ghana cedi has currently lost about 14% of its value against the US dollar in the retail market, selling at around ¢12, while it has depreciated by about 21% in value to the US dollar on the interbank forex market, going for around ¢10.95.
The local currency has posted mixed performance on the markets, although the Central Bank increased its intervention in the spot market. This is due to the heightening demand for foreign exchange as a result of market uncertainties.
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