The Ghana Cedi depreciated by 8.4% against the U.S. Dollar in 2018, compared with a depreciation of 4.9% in the preceding year. The Cedi opened the year with an exchange rate of GH¢4.4157 to a dollar but closed the year at GH¢4.8200 to a dollar.
In the last 20 years, the Cedi has depreciated by a yearly average rate of 12.5% against the U.S. Dollar. Meanwhile, the Cedi has depreciated by 95.1% against the Dollar over the 20-year period. The Cedi’s best performance against the Dollar in the last 20 years was in 2005, when it depreciated by 0.9% against the Dollar. Its next best performance occurred in 2006, when it recorded a depreciation of 1.1% against the Dollar. On the contrary, the Cedi’s worst performance against the Dollar was in the year 2000 and its second worst performance occurred in 1999. It depreciated by 49.8% and 33.6% in 2000 and 1999 respectively against the Dollar.
The Cedi’s perennial depreciation against the USD could mainly be attributed balance of payment challenges, external pressures on the local economy (mainly resulting from lower commodity prices and capital flight) and activities speculators.