The Ghana cedi is expected to end 2023 at ¢12.40 to one US dollar, Fitch Solutions has predicted.
This means the rate of depreciation will be far lower than the 38% 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 cushion the cedi against foreign exchange pressures.
It 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 cedi has so far depreciated by about 14% to the US dollar in the retail market, selling at about ¢12. However, it has lost about 21% in value to the American greenback on the interbank forex market, going for about ¢10.95.
For the past two weeks, 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 heightening demand for foreign exchange as a result of market uncertainties.
Last week, the cedi lost 1.03% week-on-week against the dollar, closing at a mid-rate of ¢12.10 to one US dollar$.
It also lost 1.34% against the pound and 0.96% against the euro.