Ghana dollar bond fell, aggressive production of labor higher, after Standard & Poor’s cut its credit rating to among the lowest in Africa as the country continues talks with the International Monetary Fund for a bailout.
Ghana Dollar Bond
Yields on $1 billion (R11 billion) of debt due August 2023 rose a third day, enhancing 13 basis points to 7.84 percent by 11:08 am in the capital, Accra.
That’s the biggest advance on a closing basis since October 15.
The distinctness between Ghana’s protection sold last month due January 2026 and similarly dated Treasuries and exchequer open up to 579 basis points.
S&P lowered Ghana’s rating to B-, six levels under investment rank.
That places the West African nation on par with constitutional Republic of Congo and Egypt in sharing S&P’s shortest credit capacity in Africa, according to data accumulate by Bloomberg.
Ghana is in talks with the IMF for a three-year program that could give the world’s second-biggest cocoa producer $800 million balance of payment support, according to Finance Minister Seth Terkper.
“S&P shares our scepticism over whether the government would be able to credibly implement rectify even if a financial aid deal were secured in coming months,” Johannesburg-based ETM Analytics Africa Analyst Gareth Brickman and Junior Analyst Catherine Bennett said in an e-mailed note to clients today.
Moody’s Investors Service and Fitch Ratings rate Ghana five steps under investment rank.
S&P’s resolution reached to downgrade “reflects the present situation of the economy,” said Terkper.
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