This month marks 6 months since the Bank of Ghana (BoG) first introduced new and some revised foreign exchange rules to prevent the cedi from further depreciation against some major foreign currencies.
Citi Business News desk analysis shows that the cedi depreciated by about 27 percent against major trading currencies from the beginning of the year and about 22 percent after the introduction of the foreign exchange rules on February 4.
Prior to the introduction of the new rules, the cedi had depreciated by about 8.1 percent to the US dollar, about 6.8percent to the British Pound and 6.4percent to the Euro.
The Cedi�s rate of depreciation against the US dollar in the past month has however been better than previous months this year.
From the first of July this year to date the cedi depreciated by 1.02% to the dollar and 0.92% against the British Pound but appreciated against the Euro by 0.47%.
But this trend for this month, where depreciation of the cedi against the major foreign currencies especially the dollar and the pound has slowed down and reduced marginally was not the same a few months back especially in February when the rules were initially introduced.
In March one month after the new FX rules were introduced, the rate of depreciation slowed down from 8.1percent to 4.9percent.
It however increased in the April by 6.2percent, dropped to 3.6 percent in May and worsened to 4.6 percent in June.
But the rate of depreciation this month five months after the rules were initially introduced shows the rate of depreciation has fallen significantly.
As at fourth July it had reduced to 2.7percent.
It�s unclear what has accounted for this drop and whether the bank of Ghana�s review of the rules last month may have played a role in the cedi�s performance
The Bank of Ghana last month ditched some of the rules it introduced in February.
About seven of the rules introduced in February were dropped.
For this year alone the Cedi has depreciated against the US dollar by about 27 percent.
This is about 24 percent more than what was experienced last year.
According to the bank of Ghana for the same period last year the cedi depreciated by only 3.4 percent.
Some industry players says the result has not been impressive and the rules has not really yielded any good results
But Governor of the Bank of Ghana Dr Henry Kofi Wampah disagrees.
He warns speculative activities from some industry players is the currently the main reason why the cedi is still struggling against major foreign currencies.
�people keep talking it down, talking down the cedi makes it even more likely to reach the bad levels that we[Ghanaians] already think it is. Even if you say that the cedi is going to depreciate, I will ask that you put a figure to it,�
Meanwhile with the Euro the rate of depreciation slowed down from 6.37percent to 6.35percent in the first month, 5.9 percent in the second, downwards to 4.8 percent in the third month, and even further to 2.9 percent in the fourth.
In the period to 4th July, the rate of depreciation has dropped to 2.5percent. In all, the Cedi has depreciated against the Euro by about 26 percent from the beginning of the year.
For the British pound however the rate of the depreciation got worse in June.
It however slowed down steadily from 6.9 percent to 5.7 percent in the second month, to 5.2percent in the third month and 3.9 in the fourth after the forex rules were introduced in February this year.
This shows the rate of depreciation worsened to 4.9 percent in the period to July 4th.
In all the Cedi has depreciated against the British Pound by about 29 percent from the beginning of the year.
<<Print>>