As Ghana waits for a monetary bailout from the Worldwide Financial Fund (IMF), the nation’s foreign money continued its slide versus the greenback after the respective currencies’ change price slipped to simply below C15:$1. Following this newest plunge, the cedi has now depreciated by greater than 55% in 2022 and this makes it the world’s worst-performing foreign money.
World’s Worst Performing Forex
The depreciating Ghanaian foreign money — the cedi — not too long ago touched a brand new low versus the U.S. greenback on the foreign exchange parallel market after it reportedly slipped by 12% in simply 4 days. Stories of the Ghanaian foreign money slumping to a brand new low versus the dollar got here shortly after the cedi’s 3.3% slip on October 17 confirmed its new standing because the world’s worst-performing foreign money.
Based on the Myjoyonline report, the acute scarcity of U.S. {dollars} amongst banks and bureaux de change is the first motive why the cedi has now fallen by greater than 50% because the begin of 2022. To assist this assertion, the report cites testimony from one unnamed banking govt who urged financial authorities to make a fast and decisive transfer to halt the foreign money’s decline. One other unnamed banking govt advised that people’ hoarding of the U.S. greenback could also be compounding the cedi’s woes as nicely.
Ghana Eagerly Awaits IMF Bailout
Nevertheless, in a special report, Myjoyonline quotes Ghana’s Finance Minister, Ken Ofori-Atta, who expressed his shock on the cedi’s speedy depreciation. He claimed that Ghanaians importing items earmarked for the upcoming Christmas holidays are partly in charge for the foreign money’s collapse.
“It’s fairly perplexing to see the place it’s going. After all, usually in October, individuals are importing for Christmas and perhaps there’s a rush for that (the greenback) however my expectation is that when we additionally conclude with the Fund (IMF), that can result in the fund’s disbursement early subsequent yr to do this,” Ofori-Atta reportedly stated.
Additionally, within the report, the Finance Minister appeared to suggest that when the IMF’s bailout funds are disbursed, the cedi will stabilize. Ofori-Atta additionally implored Ghanaians to keep away from panicking as doing this tends to “put stress on the foreign money.” He additionally insisted Ghana’s economic system is in reality “in good condition.”
In the meantime, on the time of writing, some media reports advised the cedi had misplaced additional floor versus the dollar and was now buying and selling at slightly below C15:$1. Based on a Myjoyonline report, this change price between the 2 currencies means that the cedi’s depreciation towards the dollar now exceeds 55%.
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