The Economist Intelligence Unit (EIU) of the United Kingdom predicts a 22% depreciation of the cedi against the US dollar in 2023.
According to its Africa Outlook 2023 Report, this will place the local currency as the third worst performing currency on the African continent.
The EIU expects the exchange-rate weakness to continue into 2023, albeit to a lesser degree.
“Most African currencies have lost substantial value against the US dollar during 2022 and we expect exchange-rate weakness to continue into 2023, albeit to a lesser degree”.
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It stated that the currencies of Sudan and Zimbabwe will be among the weakest in the world in 2023, while Ghana, Malawi, Sierra Leone, Ethiopia, and Egypt, all of which will face high inflation, will have their currencies drop by more than 10% against the US dollar.
It went on to say that African powerhouses Nigeria, South Africa, Angola, Algeria, and Kenya would not be immune to currency weakness and will see their currencies depreciate further against the US dollar in 2023.
Meanwhile, the Zambian kwacha will maintain its position as Africa’s best performing currency in 2023, with an 8% appreciation against the US dollar.
It will be followed by the CFAs of Burkina Faso and Cameroon, which are all predicted to rise against the US dollar.
So far in 2022, the Ghana cedi has lost slightly more than 27% of its value. In the retail market or the forex bureau, it is now trading at 11.25 to one US dollar.
After registering one of its worst performance in the first 11 months of 2022, it however improved in value strongly after the Staff-Level agreement between the International Monetary Fund and the government was announced at the beginning of this month.
SOURCE: myjoyonline
