The Ghana cedi weakened against the dollar and the major foreign currencies last week, primarily due to the strengthening of the US dollar.

This follows the Federal Reserve of the USA’s 0.25% rate cut.

Consequently, the cedi depreciated by 0.95% week-on-week versus the dollar, 1.27% against the British pound and 1.79% to the euro.

This is despite the Bank of Ghana’s increased injection of about US$213 million into the domestic foreign exchange market. The local unit closed the week trading around GH¢16.10 to one dollar.

It began this week unchanged at GH¢16.10 to one American greenback. The year-to-date loss stands at 23.19%.

Prior to this, the cedi had appreciated against the American green back for about three weeks.

Last week, the Federal Reserve announced a 0.25% rate cut but maintained a hawkish outlook as core inflation remains above the Fed’s 2% medium-term target. This announcement sent the US Treasury yields rising, which firmed the US dollar globally.

The US dollar index rose 120 basis points week-on-week, putting most African currencies on the back foot last week, including the cedi.

Analysts believe the cedi may extend its weakening in the near term following the strengthening of the US dollar.

However, the local unit is expected to remain relatively stable this week as the Bank of Ghana continues to intervene in the forex market.