Cedi now African worst currency; depreciates 7.60% to dollar

With only two months into 2022, the Ghana cedi is now the African continent’s worst-performing currency.

This is because it has depreciated by about 7.60 percent against the dollar, surpassing the Zambian kwacha, which was the continent’s worst-performing currency two weeks ago.

Both Ghana and Zambia are grappling with escalating debts as well as revenue mobilization and expenditure management issues.

This quandary is having a negative impact on the country’s exchange rate, interest rate, and inflation. Furthermore, the recent downgrade of the country’s borrowing capacity is a major source of concern, as investors remain uncertain about the Ghanaian economy’s prospects.

This supports the assertion of some economists and analysts that all concerns about the Electronic Transaction Levy must be addressed and passed by Parliament as soon as possible.

If not, the depreciating cedi will have an impact on the budgets of most corporate institutions and reduce consumer disposable income.

However, there is some hope for the future because the World Bank Group has approved a five-year Country Partnership Framework for Ghana from this year to 2026.

This will result in a $4.5 billion injection into the economy over the next five years.

The CPF will assist Ghana in achieving its COVID-19 and medium-term development goals. It is organized around three interconnected focus areas: improving conditions for private sector development and quality job creation, improving inclusive service delivery, and promoting resilient and sustainable development.

Meanwhile, with a 4.12 percent appreciation to the dollar, the Namibian dollar surpassed the South African rand as Africa’s best performing currency.

The South African rand is second, with a 3.68 percent gain against the dollar.

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SOURCE: myjoyonline