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Pressure on the Ghana cedi is easing as the year draws to a close, marking a notable turnaround after years of sustained volatility.
The improved stability is offering relief to businesses that rely heavily on predictable exchange rates for planning, pricing and cross-border transactions.
Last week, the Ghana cedi started trading on the interbank market at GHȼ11.50 to the US dollar, GHȼ15.36 to the pound sterling, and GHȼ13.47 to the euro. By midweek, it had strengthened slightly, with rates at GHȼ11.36 to the dollar, GHȼ15.31 to the pound, and GHȼ13.37 to the euro.
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The improvement eased concerns about currency volatility, which in the past has often followed seasonal spikes in foreign exchange demand.
The cedi entered this week on a strong footing as the year draws to a close, with the interbank market quoting the dollar at GHȼ11.11, the pound at GHȼ15, and the euro at GHȼ13.08.
This marks a sharp contrast to the same period last year, when the dollar traded at GHȼ14.71, the pound at GHȼ18.49, and the euro at GHȼ15.33.
The easing pressure on the cedi is a combination of factors, including a decline in seasonal forex demand linked to festive imports and higher inflows from the diaspora, which have boosted foreign exchange supply and supported currency stability.
The gains are also underpinned by a current account surplus, complemented by favourable balances in the capital and financial accounts, strengthening Ghana’s external position and providing a cushion for the local currency.
Businesses and individuals that rely on a stable and appreciating cedi are hopeful that the positive trend will continue into the New Year, helping to reduce the cost of doing business.
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