The Ghana cedi is expected to depreciate less by the end of the year, according to research and market intelligence company Fitch Solutions.
The Ghana cedi could trade at around $12.40 to the US dollar, up significantly from the 38% devaluation saw last year, according to Fitch.
The research and market intelligence company’s claim is predicated on the idea that Ghana will be able to secure an IMF-supported program by May 2023, which will go a long way toward protecting the cedi from pressures related to foreign exchange.
The IMF executive board has approved Ghana’s program, and while there will continue to be short-term exchange rate volatility, the IMF expects the cedi will stabilize once a formal creditors’ committee is established.
The Ghana cedi is currently worth around 14% less than the US dollar in the retail market, where it trades for around $12, while it has lost nearly 21% of its value in the interbank forex market, where it trades for about $10.95.
Although the Central Bank boosted its participation in the spot market over the past two weeks, the local currency has had a mixed performance on the markets.
