“It’s 10/$:” Ghana Cedi Beats Naira, 150 Others to Emerge Best-Performing Currency Worldwide
- The Ghana cedi has remained a top performer in the world in the last six months
- Cedi beat about 150 other currencies to emerge best-performing across the globe
- It is currently trading at 10 cedis to a dollar, and experts believe it will sell at a higher rate against the US dollar soon
In the past six months, Ghana’s currency, the Cedi, has been the best-performing currency against the United States greenback, the dollar.
The West African country’s currency is strengthened by renewed investor optimism that the government will obtain approval from the International Monetary Fund (IMF) for a $3 billion loan.
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Ghana cedi defies odds, beats other currencies in Africa
According to Bloomberg, the Cedi has gained about 33% since November, trouncing about 150 other currencies globally.
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Ghana’s dollar bonds have also bounced back, generating a return of almost 12%, outpacing the 3.6% average for emerging markets in a Bloomberg ranking.
The country expects the immediate disbursement of $600 million, the first tranche of the $3 billion loan, upon the IMF board’s meeting on Wednesday next week, according to the country’s Minister of State for Finance, Mohammed Adam.
Another $600 million is expected in November, and the remainder paid equal portions of $350 million every six months, based on IMF’s reviews.
Experts attributed Cedi’s stellar performance to the positive development as it strengthened for four consecutive days, reaching 10.95 per dollar.
IMF loan to further boost the currency performance
If the Ghanaian authorities receive the initial funding and market sentiment remains positive, the currency might trade 10 against the dollar.
The IMF loan will be critical in refilling the country’s foreign exchange reserves, which have fallen by almost 50% since it peaked in August 2021.
The country’s central bank used the reserves to cushion the pressure on the currency after the country experienced a debt default.
Ghana is using the G20’s Common Framework to restructure its debt as part of its efforts to obtain the IMF loan.
The tool aims to enhance coordination between conventional creditors like the Paris Club and other lenders like China.
Other African countries, such as Zambia and Ethiopia, are using similar frameworks in their bid to restructure their debt obligations.
Ghana Cedi bounces back, becomes world’s best-performing currency
Legit.ng reported that the Ghanaian money is on track to recovery after posting an impressive result against the US dollar five days in a row. The development comes amid Ghana’s plan to reorganise its local debts.
According to Bloomberg, the rise in the currency value comes alongside hopes of realising a $3 billion bailout the country requested from the International Monetary Fund (IMF) for months.
Per the reports, the cedi rallied 10 per cent in the past five days, the most significant gains among 150 currencies Bloomberg tracked.
Source: Legit.ng
