Weekly Highlights
• GSE improved its year-to-date performance.
• Ghana cedi lost grounds to the dollar and the pound sterling.
• Wall Street extends bullish run, as investors anticipate a positive outlook on U.S companies’ upcoming results for the quarter ended.
• Brent crude oil declined marginally on global recovery uncertainty.

Macroeconomic Update

Key Ghana Economic Data

Indicator 2018 2019 2020 2021 2021
Target Actual
Inflation CPI (y-o-y %) 9.40 7.90 10.40 8.00 8.50
Inflation PPI (y-o-y %) 4.40 13.00 7.00 n/a 11.80
Monetary Policy Rate (%) 17.0 16.00 14.50 n/a 13.50
GDP Growth (y-o-y %) 6.3 6.5 0.4 5.00 3.1
Budget Deficit (% of GDP) 3.8 4.5Sep 11.7 9.50 2.6 Q1
Public Debt (% of GDP) 57.6 63.00 68.3 n/a n/a
Fx. Reserves (M. Cover) 3.7 4.1 4.1 4.00 n/a
Source: BOG; MOFEP; GSS.

Government of Ghana Treasury Securities

Treasury Bills, Notes & Bonds (%)
Date 91-Day 182-day 364-day 2-Yr 3-Yr 5-Yr
Jul 12 – Jul 16 12.56 13.37 16.32 17.60 17.70 18.80
Jul 05 – Jul 09 12.59 13.38 16.33 17.60 17.70 18.30
Jun 28 – Jul 02 12.63 13.38 16.33 17.60 17.70 18.30
2021 Yr Open 14.09 14.12 17.00 18.50 19.25 19.85
NB: The above are the annual yields on Government of Ghana Treasury Securities.

At the close of the week’s auction, interest rates on the GOG Treasury securities saw marginal declines. The yield on the 91-Day T-Bill dropped by 3 basis points to 12.56 percent while both the 182-Day and the 364-Day T-Bill shed a basis point each to settle at 13.37 percent and 16.32 percent, respectively. Yields on the GoG Bonds and Treasury Notes also ended the week flat, as they were not scheduled for the week’s auction.

Results of Auction held on 9th July, 2021

Bill Bids Tendered GHS (Million) Bids Accepted GHS (Million) Interest Rate (%)
91-Day T-Bill 1,276.70 1,276.70 12.5637
182-Day T-Bill 124.13 124.13 13.3676
364-Day T-Bill 149.46 125.60 16.3202

At the close of the last auction, Government accepted all the GHS 1,400.83 million worth of bids tendered in by the participating primary dealers for the 91-Day and 182-Day Bills but rejected 16 percent of the GHS 149.46 million bids tendered in for the 364-Day T-bill. The sale of these securities by Government exceeded the week’s target by GHS 221.43 million. The sale of the 91-Day security dominated the auction, accounting for 84 percent of the total bids accepted by Government. In the next auction, Government expects to raise a of total of GHS1,281.00 million through the sale of the 91and 182 Day Bills.

The yield curve sustained its normality with further ease in rates at the short-dated ends. The decline in rate is expected to continue due to the policy intent of the central bank aimed at reducing the frequency of interest payment, whiles making returns on long-dated investment much attractive. This development is projected to aid the private sector’s penetration in economic growth, as it seeks to results in cheaper cost of capital.

Ghana Stock Exchange

Ghana Stock Exchange (GSE) Indices (YTD %)
Year 2017 2018 2019 2020 2021
GSE-CI 52.73 -0.29 -12.25 -13.98 36.62
GSE-FSI 49.51 -6.79 -6.23 -11.73 6.05

The Accra Bourse inched up its year-to-date performance, as the GSE Composite Index rose by 0.02 percentage points to settled at 2,652.54 points, corresponding to a year-to-date return of 36.62 percent. The GSE Financial Stock Index also posted a weekly gain of 0.21 percentage points. This raised its index level to 1,890.61 points, representing a year-to-date return of 6.05 percent.

GSE Market Indicators
Wk. Open Wk. End Change
Total Volume Traded (M) 6.66 2.66 -60.06%
Total Value Traded (GHS M) 6.68 6.10 -8.68%
Market Cap (GHS M) 61,564.82 61,568.25 0.01%

Trading activities on the Accra Bourse ended the week on a positive note.
A total of 2.66 million shares worth GHS 6.10 million exchanged hands in twenty-one equities. MTN Ghana Ltd dominated the activity chart in terms of volume, with 39.39 percent while GCB was the most valuable stock recording, 69.98 percent of total value traded and pushed the market capitalization up by one basis to settle at GHS 61,568.25 million.

Stock Price Movements

On the price movers list, a total of 3 stocks altered their prices with 2 advancers and a laggard. Benso Oil Palm Plantation led the bull’s chart with 8 pesewas rise to close the week at GHS2.25 per share. Société Générale Group Ltd followed the trend with 3 pesewas price lift to settle at 95 pesewas per share.

Stock Price Advancers in terms of WK closing prices
Equity Yr. Open Wk. Open Wk. End Wk. Change YTD (%)
BOPP 2.00 2.17 2.25 0.08 12.50
SOGEGH 0.64 0.92 0.95 0.03 48.44

On the losing side, Unilever Ghana PLC was the lone laggard as it trimmed 33 pesewas of its market price to finish the week at GHS 3.00, per share.

Stock Price Laggards in terms of WK closing prices
Equity Yr. Open Wk. Open Wk. End Wk. Change YTD (%)
UNIL 8.29 3.33 3.00 -0.33 -63.81

Currency Market

Currency Buying Selling Currency Buying Selling
USD 5.7773 5.7831 CAD 4.6282 4.6329
GBP 7.9998 8.0084 CFA 95.5788 95.6736
EUR 6.8562 6.8630 JPY 0.0524 0.0525
AUD 4.3207 4.3262 ZAR 0.4054 0.4058
NGN 71.1550 71.2968 CNY 0.8928 0.8935
Source: Bank of Ghana 25.05.2021

The interbank currency market ended with the Ghana cedi depreciating against the US dollar and the British pound but appreciating versus the Euro. The US dollar remained bullish on the international forex market on the back of investors becoming more cautious over concerns that global economic recovery could be hampered by the surge and fast spreading of the new delta variant of the Covid-19 virus. The fall in U.S Treasury yields after data released from the Institute of Supply Management’s survey showed that the services industry activity moderated in June, inhibited by labour and raw material shortages, resulted in continuous pile up of unfinished work. The ISM survey's measure of service employment trimmed to a reading of 49.3 in June from 55.3 in May. Although minutes from the US Fed’s policy meeting showed onset of inflation concerns, it could not whip the greenback’s gains. The US dollar thus advanced by 0.28 percent against the local currency at a selling price of GHS 5.78, to record a year-to-date appreciation of 0.35 percent.

The UK GDP monthly release showed that the economy expanded less-than-expected in May, arriving at 0.8 percent versus the 1.7 percent expectation. The British Pound Sterling thus staged a marginal week-on-week appreciation of 0.69 percent to the local currency as its selling price moved slightly to GHS8.01 on the interbank currency market. The year-to-date depreciation of the cedi thus settled at 1.62 percent.

The Euro broke down a bit during the week, but it recovered. The buying pressure in the European currency remained relatively well and sound as the optimism seen in the second half of the week shows gains on the back of dollar weakness, which is underpinned by invertors’ preference for riskier assets. The absence of relevant releases in the euro docket, the largely anticipated results from the ECB’s strategy review on Thursday and no new information from Lagarde’sr speech on Friday, shifted attention to the ECB’s Accounts of the June meeting. The spate of spread of the delta variant of the coronavirus, coupled with concerns of yield drop for the 10 year note issuance in the U.S, caused a sour mood in the market. . The Euro thus depreciated by 0.44 percent at a selling price of GHS 6.86 on the interbank currency market. The year-to-date appreciation of the cedi thus narrowed to 2.98 percent.

International Market

Stock Indices
Wk. Open Wk. Close Change (%) YTD (%)
S&P 500 Index 4,352.34 4,369.55 0.40 16.33
DJIA 34,786.35 34,870.16 0.24 13.93
FTSE 100 7,123.27 7,121.88 -0.02 10.24
NIKKEI 225 28,783.28 27,940.42 -2.93 1.81
FTSE/JSEAllShare 66,323.76 66,385.57 0.09 11.74
NSE All Share 38,219.88 37,994.19 -0.59 -5.65
Nairobi All Share 171.21 175.22 2.34 15.19

Trading activities on Wallstreet finished the week positive, as investors anticipate a positive outlook on U.S companies’ upcoming results for the quarter ended. An impressive leap in second quarter earnings of strong sectors of the economy is anticipated to record a peak for U.S earnings growth and recovery from last year’s pandemic induced profit collapse. The S&P 500 thus recorded a week-on-week gain of 0.40 percent to close at 4,369.55 points. The Dow Jones Industrial Average also lifted by 0.24 percent to finish the week at 34,870.16 points.

The London Stock Exchange ended week in the downtrends on the back of disappointing GDP data release. The British economy grew marginally to a less-than-expected 0.8 percent m/m in May below, the 1.5 percent forecast by investors whiles GDP figures for April was also revised downwards to 2% depicting an ease in economic rebound from May 2021. The London bourse thus recorded a week loss by 2 basis points to close at 7,121.88 points.

The Japanese Stock Exchange trended down inspired by losses in the Paper & Pulp, Railway & Bus and Real Estate sectors. The Nikkei 225 thus penned a weekly loss of 2.93 percent to close at 27,940.42 points index.

On the African equity market, the Johannesburg All Share Index upped by 0.09 percent to close at 66,385.57points. The Nairobi All Share Index, also went bullish by 2.34 percent to settle at 175.22 points. The Nigerian All Share Index, however dipped by 0.59 percent to end the week at 37,994.19 points.

Commodities
Wk. Open Wk. Close Change
(%) YTD (%)
Crude Oil $/barrel 76.17 75.55 -0.81 45.85
Gold $/ounce 1,783.30 1,810.60 1.53 -4.46
Cocoa$/metric tonne 2,290.00 2,318.00 1.22 -10.95
Coffee $/pound 1.5255 1.5130 -0.82 17.97
Source:www.bloomberg.com, & www.investing.com

Brent crude oil dipped on the international commodities market, fuelled by concerns over slow global recovery weighed by the possibility of tightening supply after meeting among key suppliers to raise output in the coming months remained uncertain. Saudi Arabia, the top world oil exporter, agreed to an August 2021 figures from five buyers, but rejected at least two requests for additional volumes. Brent crude oil thus went down by 62 cents to close the week at $75.55 per barrel.

The yellow metal further appreciated in value on the international commodity market, posting a third successive weekly gain to return to a crucial $1,800 territory on the back of slowdown in the global economy, amid consequences of the rising Delta variant of covid-19. Low vaccination rates in some regions of the world increased the demand for the precious metal as a safe haven. Gold thus rose by 1.53 percent to trade at $1,810.60 per ounce.

Chocolate demand appears to be roaring back in Europe as easing Covid-19 restrictions encouraged consumers to buy more treats again. Cocoa processing jumped 14 percent in the second quarter from a year earlier. Grinding in the world’s biggest consuming region suggests consumption is continuing to rebound as life starts to return to normal, aiding spending in stores, restaurants, and airports. Cocoa thus traded at $2,318.00 per metric tonne.

Coffee trimmed its market price on the international commodity market by 0.82 percent, despite a projected dip in output supply according to data released by the International Coffee Organisation (IOC).This is because as the world’s largest producer, Brazil, faces one of its worst droughts in almost a century. The soft crop shed 1.25 cents week-on-week to trade at $1.51 per pound.

Note: The data in this publication is Friday on Friday (w/w)