Ghana’s local currency has ended the first quarter of 2021 on a high note with a year-to-date appreciation of 0.6 per cent to the US dollar.
This means the Ghanaian cedi has outperformed some other prevalent 15 currencies in Africa, making it the best performing currency. These include the Egyptian pound, Nigerian naira and the South African rand, Ghanaweb reports.
According to a Joy Business report monitored by GhanaWeb, the cedi’s performance is almost similar to that of 2020.
Additionally, the cedi has profited from growth-related efforts such as diversified exports of cocoa, gold among others.
Explaining the reasons for the cedi’s performance, Senior Economic Analyst at Databank Research, Courage Martey, said, “the Ghana cedi ended the first quarter of 2021 with yet another impressive performance, similar to what it did in the first quarter of 2020.”
“You will recall that in the first quarter of 2020, the local currency ended the quarter with an appreciation of almost 1.7% against the US dollar and that made it the second most resilient currency in our basket of 15 African currencies, only behind the Egyptian pound.”
“It is quite impressive, against the fact that the pandemic has not yet given way, so there is still so much uncertainties within the global financial market space,” he said.
Martey attributed the cedi’s strong performance due to the Bank of Ghana’s intervention measures, particularly in the Forex (FX) Forward market.
“Immense thanks to the Bank of Ghana’s intervention measures, particularly on the FX forward market but the significant inflows of foreign portfolio investments into the bond market especially during this year has been significantly supportive of the Ghana cedi to put up the kind of performance we see in the first quarter of 2021,” he said.