GHC

GHC is the abbreviation for the Ghanaian cedi, the official currency of the Republic of Ghana. The GHC debuted on July 3, 2007. The Ghanian cedi also uses the currency symbol GHS.

The word cedi derives from the African word for cowry shell, a prior form of Ghanian currency. One cedi is divided into 100 pesewas.

As of mid-2018, a Ghanian cedi equaled about 21 U.S. cents. Conversely, it took about 4.8 Ghanian cedis to equal a dollar.

GHC got its start in 1965, when Ghana left the U.K. pound, roughly eight years after the country gained independence from Britain. Following a coup, the new government replaced this cedi in 1967, due partly to very high inflation, The Bank of Ghana again replaced the cedi in 2007. It continued to lose value precipitously, although the volatility ebbed to a degree beginning in late-2015, following a $918 million loan from the International Monetary Fund that supported jobs growth and kept social spending programs alive.

Ghana is of interest to some traders, as it has the largest GDP per capita in West Africa. It is also among the fastest growing frontier economies in the world.The country is Africa’s second-largest gold producer, trailing only South Africa. It also produces cocoa, diamonds, and minerals for making aluminum and steel. However, the Bank of Ghana sometimes limits access to those who trade the cedi. It last did so in 2014, which bank officials said was an effort to gain reparation of export proceeds.

Bank notes come in 1, 5, 10, 20 and 50 denominations. The currency is overseen and issued by the Bank of Ghana.

The cedi fluctuates partly on policies set by the Bank of Ghana and a cycle of debt spending. For example, foreign nations forgave a large portion of the country’s debt in 2005, but the debt crept back up again, leading to eventual currency revaluations.

Following its latest loan to the Bank of Ghana, IMF officials seek to contain government expenditures, instill more fiscal discipline, improve budget transparency and renew efforts at revenue collection. However, significant public spending still remains necessary to maintain social programs.

Additionally, both the economy and the currency vacillate based on the price of oil. The country is a significant producer, with as much as 7 billion barrels of oil in reserves. In addition, oil is an input for the country’s manufacturing industry, which produces many inexpensive consumer products made of plastic.