JPMorgan Sees Ghana Cedi Dropping 20% on Inflation, Reserves

Ghana’s cedi, the worst-performing African currency in the first quarter, could depreciate another 20 percent this year as foreign-exchange reserves recede and inflation accelerates, according to JPMorgan Chase & Co.

Increased risk of outflows from the “heavily” foreign-owned local bonds, uncertainty around commodity prices and fewer signs of a “real turnaround in the country’s fiscal situation” add to the cedi’s weaker outlook, Giulia Pellegrini, sub-Saharan Africa economist at JPMorgan, said in a report yesterday.