More pressure on the cedi as BoG forex auction is oversubscribed by $221m
Demand for dollar by banks, businesses and particularly importers and exporters has seen a huge increment over the past weeks.
The rising demand for the greenback by banks, businesses exporters and importers is evidenced by the recent oversubscription of the Bank of Ghana’s (BoG) dollar auction by $221m.
The Central Bank in its forex forward rates auction on Tuesday, March 8, 2022, met its target of auctioning $75 million to bidders for the dollar.
The $75 million was however out of a total of $296.75 million bids submitted by banks, importers, exporters and businesses that have need of the greenback for their transactions.
The high demand and oversubscription of the BoG’s forex auction puts more pressure on the cedi enabling or facilitating its depreciation against the dollar.
As of March 8, 2022, the cedi had recorded a year-to-date depreciation rate of 14.21% against the greenback.
Given the cedi’s performance against its anchor currency, it has been ranked the worst currency among the top 15 currencies on the African Continent by Bloomberg.
Read: Finance Ministry announce issuance of 5 year cedi denominated bond
In accepting the $75 million bids made, the BoG rejected bids to the tune of $221.75 million made by buyers.
Bids by buyers were made for the 7 day, 15 day, 30 day, 45 day, 60 day and 75 day tenors.
Total bids submitted for the 7 day tenor amounted to $144.5 million of which the BoG accepted $32.75 million.
For the 15 day, 30 day, 45 day, 60 day and 75 day tenors, bids made totaled $94.25 million, $41 million, $11.25 million, $4.25 million and $1.5 million respectively.
The BoG, for the 15 day, 30 day, 45 day, 60 day and 75 day tenors accepted bids totaling $23.25 million, $9.5 million, $3.75 million, $4.25 million and $1.5 million respectively.
The BoG’s forex forward auction programme is to help govern the conduct of forex auctions on the interbank foreign exchange market, deepen the forex market and reduce uncertainty on the future availability of dollars to meet the forex need of banks, importers, exporters and other businesses.
Peruse details of the forex forward auction below:
Forward Auction Result No 0064 by Fuaad Dodoo on Scribd
