Cedi weakens on strong corporate demand

ACCRA May 16 (Reuters) - The Ghana cedi weakened against the U.S. dollar on Monday, with strong corporate demand breaking a two-week spell of stability, traders said.

Jacob Brobbey from Barclays Bank Ghana quoted the dollar-cedi at 1.5095/20 at 1400 GMT, sliding from 1.5065/90 at the start of the session.

"Fundamentally there is some demand from manufacturing and the commercial sector, importers, whereas the supply side is weak," he said, dismissing the notion that the slide was triggered by a 50 basis point prime rate cut on Friday last week.

"Going forward, the Monetary Policy Committee have said they want to minimize volatility in the market -- a clear indication that they will support the cedi in the coming weeks," Brobbey said.

At his May 13 news conference, Bank of Ghana Governor Kwesi Amissah-Arthur said the central bank would "continue to preserve competitiveness while at the same time minimising volatilities in the foreign exchange market".

Biggles Amponsah from Access Bank said the local unit may continue to lose ground on Tuesday.

"The dollar started to break its resistance this morning and by tomorrow we could see the cedi going down to 1.5130," he said. "On my side I've seen demand from customers in fast moving consumables like food, frozen food and drinks.