Cedi to remain stable against the dollar, Euro in first quarter – Analyst predicts

After the local currency was able to appreciate against the major currencies; dollar, euro and pound sterling last month, Head of Trading at Absa Ghana, Jacob Brobbey, has predicted that the cedi may perform better or is likely to remain stable in the first quarter.

“For the first quarter of this year, the currency is likely to remain very stable if not perform much better,” he stated in an interview with Citi business.

He added that the cedi's strong performance against the major currencies, as well as the positive ratings on Ghana by Moody's Corporation has boosted the confidence of offshore investors.

Bank of Ghana (BoG) in its latest Summary of Economic and Financial Data noted that cedi early this year appreciated 0.3 percent against the dollar, and also made a 1.9 percent gain on the British pound. The local currency also made a 2.3 percent gain on the Euro.

This cedi appreciation, the central bank, noted was as a result of the setting of the Forex Development (FX) committee by government through the Finance Ministry to help find stringent ways to stabilize the cedi.

The establishment of the committee was in fulfillment of a promise by Finance Minister, Ken Ofori-Atta that government would set up a bi-partisan committee to investigate the structural causes of the cedi depreciation and propose adequate measures.

The membership of the committee is drawn from the Office of the Vice President, Bank of Ghana, Agriculture Ministry, Ghana Union of Traders Association (GUTA), Association of Ghana Industries, some universal banks among other key stakeholders.