Ghana Cedi reaches 18-Year low as growth drives Dollar demand
Ghana's cedi weakened for a ninth straight day against the dollar, reaching the lowest in almost 18 years, as importers bought the U.S. currency.
The currency of the world's second-biggest cocoa producer depreciated 0.9 percent to 1.7603 per dollar by 2:05 p.m. in Accra, the capital. That's the lowest since May 31, 1994, when Bloomberg began compiling the data.
“We have seen general demand for the dollar pick up, linked to expansion of the economy,” Chris Nettey, a currency trader at the Ghanaian unit of Standard Bank Group Ltd., said by phone. “Today we saw continued buying from telecommunication and manufacturing companies to import equipment and raw material, and then, the commerce industry to import goods for resale.”
Ghana's $31 billion economy is projected to grow 7.3 percent this year, faster than the sub-Saharan African average of 5.5 percent, according to the International Monetary Fund. The government has forecast growth of 9.4 percent.
That expansion, led by the December 2010 start of oil production for export, has driven dollar demand from companies keen to invest in Africa's second-biggest gold producer. The cedi has declined 6.8 percent this year against the dollar.
“We are getting some dollar sales from exporters, but they cannot match the demand on the market,” Nettey said.