The Ghana cedi ended 2023 with a year-to-date depreciation of 15.57% to the US dollar in the retail market.
On the interbank market, the local currency lost about 27.81% in value to the dollar.
However, it was neither classified by Bloomberg in the ‘Best Spot Returns’ nor ‘Worst Spot Returns’ category.
Bloomberg pegged the cedi at ¢11.95 pesewas to the American greenback on December 29, 2023, the last day of trading in 2023. However, the forex bureaus sold the cedi at ¢12.18 to one US dollar.
On the other hand, the Bank of Ghana quoted the dollar at ¢11.64.
The performance of the cedi in 2023 was largely influenced by the 3-year International Monetary Fund programme which helped to reduce the sharp depreciation of the local currency experienced in 2022. The cedi lost about 50% in value to the dollar in 2022.
To this end, the country’s capital and financial accounts benefited from reduced portfolio outflows and lower amortization payments.
Again, the current account recorded a surplus of $1.0 billion, in contrast to a deficit of $1.8 billion recorded for the same period of 2022. These favourable developments in the current, and the capital and financial accounts, according to the Bank of Ghana, impacted positively on the balance of payments. Before the end of 2023, demand for the US dollar eased, following the arrival of the first tranche of the Cocoa Syndicated Loan.
As such, market dealers expected the foreign exchange inflows to increase the supply-side intervention and bolster the cedi in the near term.
Guinea franc best currency in Africa
The Guinea franc was the best currency in Africa in 2023, according to Bloomberg.
It gained 0.64% against the world’s most important currency – the dollar.
It was followed by the Djiboutian franc (0.15%), Mauritian rupee (-0.05%) and Mozambique new metical 0.18%) in 2nd, 3rd and 4th respectively.
In contrast, the Nigerian naira (-49.5%) and Angola kwanza (-39.14) and Malawi kwacha (-38.96%) were the worst currencies in Africa in 2023.
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