The Ghana Cedi recorded a marginal depreciation as it lost 0.58 percent against the US Dollar last week, although analysts project it to remain stable this week as foreign exchange liquidity improves.
Many had high expectations that the inflow of $360 million from the International Monetary Fund would immediately stabilise the local currency. However, the stabilisation process is on a gradual trajectory as corporate demand begins to moderate.
In the retail market, the Cedi ended the first half of the year losing approximately 22 percent against the US Dollar.
Week-on-week, the local currency shed 1.85 percent and 1.61 percent against the British Pound and Euro, respectively.
Meanwhile, the Bank of Ghana will be selling $120 million to Bulk Oil Distributors through its auction programme for the third quarter of this year. Analysts believe this will further strengthen the local currency as we navigate the second half of the year. The same amount was sold to these firms in the second quarter of the year.
Additionally, the Bank of Ghana is expected to continue its measures aimed at addressing excess liquidity in the market.
Some analysts believe that the IMF programme has restricted the Bank of Ghana in terms of its dollar market interventions as they hope that the macroeconomic environment will continue to gain momentum to cushion the strength of the cedi.
At the end of the trading day on Tuesday, July 9, a dollar was going for GH¢15.65 at some forex bureaus.
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