Ghana's Cedi Currency to Remain Stable in 2011, Standard Bank Forecasts

Ghana’s currency, the cedi, is poised to remain stable in 2011 even as the country’s economy may grow faster than a government forecast of 12.3 percent, Standard Bank Group Ltd. said.

The cedi will “remain in its 1.41-1.45 trading range over the coming year” versus the dollar, Stephen Bailey-Smith, the London-based head of Africa research at the continent’s biggest lender, in an e-mailed response to questions today. “We believe the authorities are both willing and able” to preserve the current rate.

The cedi retreated for a fourth day versus the dollar, trading 0.3 percent weaker at 1.4535 by 1:48 p.m. in Accra, according to Bloomberg data. Ghana’s central bank attempted to keep the currency below 1.4500 to the dollar by selling about $25 million on Nov. 24 and is likely to intervene again tomorrow, Kwabena Owusu, a currency trader at Access Bank Plc, said yesterday.

Ghana will begin pumping oil Dec. 15 from its offshore Jubilee oilfield. The country will produce about 1.3 million barrels this year as oil production alone will add 11.8 percent to the country’s gross domestic product, Bailey-Smith said. The overall economy may grow as much as 17.8 percent, according to the bank’s 2011 forecast, which assumes an oil price of $90 per barrel.

Ghana’s finance ministry forecast 12.3 percent growth next year assuming an oil price of $70 per barrel. Crude oil for January delivery fell 1.1 percent to $84.83 a barrel in electronic trading on the New York Mercantile Exchange.

The West African nation is Africa’s second-biggest gold producer after South Africa and the world’s second-largest cocoa grower after neighboring Ivory Coast.

To contact the reporter on this story: Jason McLure in Accra at jmclure@bloomberg.net.

To contact the editor responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net.