A Bloomberg report has indicated that Ghana’s cedi recorded an 18.21% rate of depreciation to the US dollar in the first quarter of 2022.
It ranked the cedi as the worst among African currencies with the “Worst Spot Returns”.
As reported by JoyBusiness, the report indicated that the situation could have been worse if the Bank of Ghana had not intervened on time.
The Bank of Ghana revised the policy rate upwards to 17% to attract investors and help stabilize the cedi.
However, the upwards movement of the price of crude oil due to the Russian Ukraine crisis gave the country a little boost, but this was not enough to sustain the woes of the cedi which continued to depreciate rapidly against the US dollar and other major trading currencies.
The country also to some extent benefitted from the favorable price of gold but due to the high demand for the dollar, the cedi suffered.
International rating agencies, Fitch and Moody’s downgrade of the economy sparked an interest in dollar-denominated assets.
Meanwhile, one of the government’s internal revenue mobilization measures which it says will address Ghana’s debt challenges faced great opposition, a situation government has attributed to the cedi’s woes.
Also, government has announced some expenditure cuts and moratoriums on imports to further cushion the economy.
The Angolan Kwanza is however the best performing currency in Africa this year with an appreciation of 24% to the dollar in the first quarter of 2022.
It is followed by the South African rand with an appreciation of 9.38% to the dollar.
CURRENCIES WITH “WORST SPOT RETURNS” AT THE END OF QUARTER 1, 2022
RANKING CURRENCY YEAR-TO-DATE
16th New Sudanese pound -2.08%
17th Ethiopian Birr -3.89%
18th Liberian dollar -4.94%
19th Sierra Leone leone -5.10%
20th Mauritian rupee -7.05%
21st Zambian kwacha -8.02%
22nd Egypt pound -14.27%
23rd Ghana cedi -18.21%
CURRENCIES WITH “BEST SPOT RETURNS” AT THE END OF QUARTER 1, 2022
Cedi depreciates against the dollar