The Ghanaian currency the Cedi, opened stronger against the US Dollar today, following an unusually active trading session on Tuesday. Interbank trading began with the Dollar quoted at 15.5200 to 15.5600 Cedis, indicating growing confidence in the local currency.
Currency trader Kodzo Dziwornu Letsa told The High Street Journal that the firmer start was driven by a combination of factors. With a shortened four-day trading week ahead, market participants showed increased urgency to complete foreign exchange transactions before the holiday period. This led to a surge in trading activity.
Adding to the positive momentum was news that Ghana has secured a Staff-Level Agreement with the International Monetary Fund (IMF) after a successful fourth review under the Extended Credit Facility programme. The announcement lifted market sentiment and supported demand for the Cedi.
The Bank of Ghana also played a key role by intervening with a surprise two-day forward forex auction, offering $100 million to the market, he added. Of this amount, $96.4 million was allocated to banks at rates between 15.5000 and 15.5200. This intervention provided a timely boost to forex supply and helped ease pressure on the local currency.
Looking ahead to today’s session, Mr. Letsa expects trading to be relatively calm, as Tuesday’s robust activity and the central bank’s auction likely satisfied much of the market’s short-term demand. With strong support from both positive economic news and central bank action, the Cedi is starting the day on a firmer footing.
A stronger cedi keeps prices of imported items including fuel stable or even decline as well as reduces government’s debt repayment pressures, as it will require fewer cedis to pay the foreign loans.
