RateCaptain
  • FX Rates
  • Money Market
  • Cryptocurrency
  • Commodities
  • Corporates
  • Contact Us
No Result
View All Result
Subscribe
  • FX Rates
  • Money Market
  • Cryptocurrency
  • Commodities
  • Corporates
  • Contact Us
No Result
View All Result
RateCaptain
No Result
View All Result
Home Currencies

Ghana Cedi Falls by 72% year-to-date

Rate Captain by Rate Captain
October 11, 2022
in Currencies
Reading Time: 2 mins read
A A
0
Share on FacebookShare on TwitterShare on WhatsappShare on Telegram

The currency of Ghana has depreciated by a whopping 72 percent against the US dollar since the beginning of the year 2022.

This steady decline in the value of the cedi is having negative implications on the purchasing power of Ghanaians. At the recently conducted meeting of the monetary policy committee of the Bank of Ghana, the interest rate was hiked by 250 basis points to 24.5 percent, as the bank recognizes that the sustained inflation is mainly from the pass-through effects of the country’s currency depreciation.

AlsoRead

South African Rand Plunges to New Low as Interest Rates Rise

Turkish Lira Plunges to Unprecedented Depths as Erdogan’s Power Grasp Shakes Economy to Its Core.

Is the eNaira a waste of government resources?

As of this writing, the exchange rate between cedi and dollar stands at GHS10.55/US$1. This is having an adverse implication for business as weakening cedi means increasing costs, particularly for businesses requiring dollars to purchase production input.

The depreciating cedi is seriously feeding inflation in the country and having implications for the macroeconomic space. Inflation raced to 33.9 percent in August with inflation expectations by consumers, business, and financial sectors suggesting an upward trend in the country.

Given the weakened currency in Ghana, there is the possibility of increasing stress in the country’s sovereign debt space. As the US dollar becomes stronger relative to the cedi, the repayment of public debt in the country becomes more expensive (in cedi terms). According to data from Ghana’s central bank, total public debt as of June 2022 was $54.4 billion (78.3% of GDP) from US$32.3 billion (55.5% of GDP) in 2017. This decomposes into US$28.1 billion (40.5% of GDP) external debt and US$26.3 billion (37.8% of GDP) domestic debt.

This state can hamper the country’s ability to receive the assistance it seeks from the International Monetary Fund (IMF). This is because the IMF will not lend to countries with unsustainable debts until they restructure their debt to restore their financial sustainability.

Considering that the cedi has depreciated significantly, the repayment of the external debt will become more expensive in terms of the domestic currency.

The weak cedi will also weigh on trade in Ghana. This is because the dollar dominates international transactions. For major commodities like oil which is sold in dollars, there will be a direct increase in the amount required for purchasing these items.

Previous Post

Nigeria’s forex market in quagmire as sources of dollar inflow plummet

Next Post

Naira exchanges with the dollar for N729 at the black market

Related News

South African Rand Plunges to New Low as Interest Rates Rise

South African Rand Plunges to New Low as Interest Rates Rise

by Rate Captain
May 29, 2023
0

The South African economy has been facing a turbulent period, marked by worsening electricity shortages, rising inflation, and recent allegations...

Turkish Lira Plunges to Unprecedented Depths as Erdogan’s Power Grasp Shakes Economy to Its Core.

Turkish Lira Plunges to Unprecedented Depths as Erdogan’s Power Grasp Shakes Economy to Its Core.

by Rate Captain
May 29, 2023
0

The Turkish lira has reached an all-time low as President Recep Tayyip Erdogan secures his victory in the 2023 presidential...

Is the eNaira a waste of government resources?

Is the eNaira a waste of government resources?

by Rate Captain
May 24, 2023
0

The International Monetary Fund (IMF) recently released a report titled "Nigeria's eNaira, One Year After," revealing that 98.5% of eNaira...

Naira appreciated to N738/$ in the Parallel Market

The Rise in Currency Hoarding: Examining Nigeria’s Cash Crunch.

by Rate Captain
May 23, 2023
0

Nigeria has experienced a significant spike in currency outside the banking system for the fourth consecutive month, reaching a staggering...

Next Post
Exchange Rate Crises: How the Naira Fell from Grace to Grass

Naira exchanges with the dollar for N729 at the black market

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Recommended

US Nation’s Employers Add 339,000 Jobs in May, Defying Market Expectations.

US Nation’s Employers Add 339,000 Jobs in May, Defying Market Expectations.

June 2, 2023
Ride-hailing Drivers in Nigeria Demand a Price Increase of 200%.

Ride-hailing Drivers in Nigeria Demand a Price Increase of 200%.

June 2, 2023

Popular Story

  • Providus Bank Plc Announces Graduate Management Trainee Program 2023/2024.

    Providus Bank Plc Announces Graduate Management Trainee Program 2023/2024.

    0 shares
    Share 0 Tweet 0
  • Ride-hailing Drivers in Nigeria Demand a Price Increase of 200%.

    0 shares
    Share 0 Tweet 0
  • Telcos issue banks disconnection notice over USSD debt

    0 shares
    Share 0 Tweet 0
  • US Nation’s Employers Add 339,000 Jobs in May, Defying Market Expectations.

    0 shares
    Share 0 Tweet 0
  • Telecom Operators Blame Communications Minister for Telecom Debt Crisis

    0 shares
    Share 0 Tweet 0
RateCaptain

RateCaptain

We bring you the most accurate in new and market data. Check our landing page for details.

  • FX Rates
  • Money Market
  • Cryptocurrency
  • Commodities
  • Corporates
  • Contact Us

Copyright © 2022 RateCaptain - All rights reserved by RateCaptain.

No Result
View All Result
  • FX Rates
  • Money Market
  • Cryptocurrency
  • Commodities
  • Corporates
  • Contact Us

Copyright © 2022 RateCaptain - All rights reserved by RateCaptain.

?>