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Ghana's local currency, the cedi is heading towards its first bullish performance of appreciation against the US dollar in history, indications have revealed.

According to Ecobank Research’s tracking of Sub Saharan African (SSA) currencies, the cedi is among eight currencies in Sub Saharan Africa that have increased in value against the US dollar in 2018.

As at the end of May 4, 2018, the local currency had appreciated in value of 0.2 percent since January 1, 2018 against the American currency. It therefore traded at GHc4.408 against the US dollar.

Kenya shilling is the best performing currency in sub Saharan African, increasing 2.9 percent in value against the US dollar. It is followed by Sao Tome & Principe’s dobra, The Gambian dalasi, Coted’l voire CFA and Ethiopia bir that have appreciated 1.3,1.1 0.5 and 0.5 percent in value respectively to the ‘green back’. Malawi Kwacha and Cape Verde escudo have increased in value against the US dollar by 0.4 and 0.1 percent respectively.

On the other hand, South African rand and Nigerian naira have depreciated by 0.9 and 0.2 percent respectively to the American currency since the beginning of the year.

Ecobank Research attributes “fundamentally, stronger oil exports that continue to underpin a trade surplus estimated at 1.1 percent of GDP for February 2018 (2017: 3.6 percent) which will drive a narrowing in the current account deficit.”
It emphasized that markets are focused on plans to raise US dollar 2.5 billion external financing over the coming weeks and the disbursement of the US$191 million ECF facility by the International Monetary Fund.

The cedi ended the first quarter of 2018 with a 0.3 percent appreciation to the US dollar. Comparatively, it lost about 2.52 percent in value against the American green back in the first quarter of 2017 and lost about 4.15 percent in value in the full year of 2017.

The Bank of Ghana had earlier reported that the cedi ended the first quarter of 2018 with an appreciation of 0.3 percent in value.

BMI, research arm of ratings agency, Fitch, had earlier in the year predicted that the local currency could end the year 2018 at GHc4.42 against the US dollar, about 0.67 percent appreciation to the American currency, in its 2018 analysis of the Ghanaian economy indicates.