The Ghanaian currency, the Cedi has become the worst performing currency in the world. It lost more than 45% of its value against the US dollar in 2022. This drove up inflation in the country.
Ghana’s economic situation has become quite critical. Indeed, the Cedi lost more than 45% of its value against the US dollar in 2022. According to the financial rating agency Bloomberg, the currency of the world’s second largest cocoa producer depreciated a further 3.3% on Monday. October 17, 2022.
The central bank raised interest rates by 10 percentage points to 24.5% to contain the effects of inflation on the currency. The Ghanaian currency now takes the place of the rupee, the Sri Lankan currency as the worst performing currency in the world. It is currently trading at 13.11 units against 1 US dollar.
This situation would be due to the economic and financial crisis that the country is going through. Ghana is facing a record spike in commodity prices. Inflation rose to 37.2% last September. The situation has prompted traders across the country to go on a 72-hour strike to protest against soaring commodity prices.
The government once refusing to ask for help from the IMF, reversed its decision. He would be negotiating a financing of 3 billion US dollars (more than 2025 billion fcfa) to get out of his crisis.
The cedi has been the official currency of Ghana since 1965.
The last time the cedi reached a high performance against the dollar dates back to 2020 according to a study by Bloomberg. Ghana had explained that this reversal is linked to the drop in demand for foreign exchange from Ghanaian importers, following the coronavirus epidemic which affected travel and trade. The IMF ranked Ghana among the fastest growing economies in the world in 2019.