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Cedi Appreciates Marginally Against Dollar

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THE LOCAL currency appreciated marginally against the dollar this week, trading at 7.60 from 7.63 at last week’s close.

The Bank of Ghana (BoG) said it plans to issue GH¢24 billion of local bonds in the second quarter of this year, GH¢20 billion of which will be used to rollover existing debt and the remainder will be used for government financing needs.

The Ghana Cocoa Board (COCOBOD) also warned this week that cocoa output could drop by 31% this year amid a prolonged drought that has stunted the growth of cocoa pods.

“We expect the cedi to weaken against the dollar in the coming days due to sustained inflation and pressure on its foreign debt,” AZA Finance indicated in its weekly survey of African markets.

The report continued that the economic fallout from Russia’s war in Ukraine was causing a sharp deterioration in debt sustainability for many African nations.

According to the World Bank’s April edition of its Africa’s Pulse report, the proportion of African countries at high risk of debt distress rose to 60.5% from 52.6% in October, heightening the need for improved relief measures to help avert a potential wave of debt crises on the continent. Meanwhile, “food prices could be driven even higher and pile further inflationary pain on consumers in grain importing African countries as vessels unable to leave Ukrainian waters reduces availability and will likely push shipping rates higher,” according to the International Chamber of Shipping.

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