The local currency has enjoyed a good run against its major trading partners in the first month of the year — appreciating against all the three major currencies, the dollar, euro and pound sterling, according to data released by the Bank of Ghana.
The cedi, which depreciated against all the three currencies last year, has found a renewed strength and has so far held its own to make gains on its trading partners.
According to the Bank of Ghana’s latest Summary of Economic and Financial Data, the cedi in the first month of the year has so far appreciated 0.3 percent against the dollar, made a 1.9 percent gain on the British pound, while recording a 2.3 percent appreciation against the Euro.
Last year, the cedi depreciated 12.9 percent, 15.7 percent and 11.2 percent against the dollar, pound and euro respectively.ADVERTISEMENT
The cedi’s strong performance comes on the back of a number of measures put in place by the central bank as well as the Finance Ministry to resolve the cedi’s perennial struggles against its major trading partners.
The central bank, among other things, announced the commencement of forward fx auctions which basically allows banks and other dealers to make advance purchases of foreign currency to be supplied at an agreed rate later on.
The Bank of Ghana adopted this to help in regulating the supply of foreign currency and to stabilize the cedi for some time.
The central bank’s auction committee in a statement issued this week said it accepted less than fifty percent of the total amount of bids submitted by banks in the forex forward sales for Tuesday, January 28, 2019.
The forty million dollars accepted by the central bank is about 38 million dollars less than the amount the banks bid for.