The cedi ended the month of February 2020 with an appreciation of about 5.75% to the US dollar on the interbank market.

This is unlike in previous years where it depreciated, sometimes rapidly.

The cedi also appreciated by 4.52% at the forex bureau.

This performance is supported by ongoing Bank of Ghana (BoG) interventions on the spot and forward markets coupled with weak importers demand for foreign exchange on the market. The foreign exchange supply-side was also supported by foreign portfolio investment flows to high-yield cedi securities.

However, in the last three trading days, there were some losses of the cedi against the dollar as foreign investors limited their risk exposures in the face of the coronavirus spread across international borders.

The renewed risk-off mode of foreign investors appears to have revived offshore portfolio demand for foreign exchange coupled with the thinning supply of foreign exchange.

A currency analyst with Databank Research, Courage Martey, said: “Despite the moderate rise in depreciation risks, the market appears confident that the BoG is well-resourced with the recent US$3 billion Eurobond to support the cedi through any potential external shocks.

“With a strong FX [foreign exchange] forward supply also, we're confident of a broadly stable Ghana cedi for Q1-2020, at least”, he emphasised.

Presently, a US dollar can be bought for GHS5.29 on the interbank market and GHS5.37 at the forex bureau.

The local Ghanaian currency ended the year 2019 with a depreciation rate of about 12.9% to the US dollar, based on data from the Bank of Ghana’s website but has dramatically impressed this time around.