The cedi will remain stable against the US dollar in the near term as the upgrade in Ghana’s rating by Fitch Ratings is expected to positively impact sentiments around the local currency, some analysts have stated.
Following the successful conclusion of the domestic debt exchange programme, Fitch, upgraded Ghana’s Long-Term Local Currency Issuer Default Rating from Restrictive Default to ‘CCC’. This they believe, will impact on the cedi in the short term.
The rating agency also maintained a stable outlook on the local currency IDR and expects that a successful external debt restructuring with the resultant disbursement from the International Monetary Fund will enhance Ghana’s fiscal position.
Last week, the local unit remained fairly stable (-0.08%) week-on-week vs the US dollar in the retail market, starting the week’s trades at a mid-rate of 12.00/$ to close at 12.01/$.
Although the Bank of Ghana provided some foreign exchange support, the unit weakened 0.34% week-on-week against the pound but remained unchanged against the euro on the retail market.
Likewise, the local currency depreciated by 0.33% against the dollar, 1.68% against the pound, and 2.18% against the euro in the interbank market on a week-on-week basis
Meanwhile, the cedi has lost about 11.7% against the dollar in the retail market since January 1, 2023 and about 22% on the interbank market.