Pressure on cedi to continue; depreciated 0.85% to dollar last week

Cedi has fallen by more than 30% so far in 2022

The Ghana cedi would continue to remain under some pressure this week, following the unexpected increase in inflation and the prospect of an interest rate hike by the US Federal Reserve.

Some analysts are expecting an increase in demand for foreign exchange and limited foreign exchange interventions by the Bank of Ghana.

The local currency lost marginal ground against the major trading currencies last week after the Ghana Statistical Service announced an unexpected increase in inflation to 42.2% in May 2023.

It closed the week with a 0.85% loss against the US dollar on the retail market, bringing its year-to-date loss to almost 15% in the retail market.

The local currency also depreciated by 2.51% against the pound and 0.79% against the euro.

This is despite an injection of $32 million by the Bank of Ghana into the spot market.

It is presently hovering around ¢11.80 to the American greenback at the forex bureau.

Meanwhile, failure by the cedi to stablise against the dollar may push fuel prices up and consequently increase inflation.

This will obviously increase the cost of living and doing business.

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