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Cedi at record low on emerging markets pressure

Ghana’s cedi currency hit a record low on Tuesday, due mainly to global pressures as investors continued to exit emerging market assets, analysts told Reuters.

The currency of the major commodity exporter has weakened since the start of May, touching 4.8250 to the dollar on Tuesday.

“It is a combination of emerging market assets sell-off pressure and unmet corporate (dollar) demand,” a currency trader at a major lender in Accra told Reuters.

Cumulatively, the local unit depreciated 5.3 percent in the first six months, compared to 3.3 percent in the first half of last year, according to Reuters data.

The central bank said last month it had significantly increased its weekly dollar sales to banks in support of the local currency.

The bank’s treasury did not respond to Reuters’ request for comment on Tuesday.

Ghana, which exports cocoa, gold and oil, is in the final year of a $918 million credit deal signed in 2015 with the International Monetary Fund to reduce the budget deficit, inflation and debt and to stabilise the local currency.

Source: Reuters

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