Mr. Joe Jackson, a financial analyst and Chief Operations Officer at Dalex Finance, has revealed that people are having difficulty accessing Dollars to buy in Ghana at the moment.
To that end, he claims that more people are abandoning the Dollar, forcing them to trade in Cedis.
He believes that this will help to stabilize the Cedi against the US dollar.
On Wednesday, October 19, he said on the Ghana Tonight show on TV3 with Alfred Ocansey, “It is a difficult time, but I expect the rate to slow down.” The rate will slow because it is currently difficult to find dollars to buy and most of the people we have are giving up on buying Dollars and are slowing.
“I am also expecting that the government will soon announce measures that will indicate to the market that it is serious about the reducing its expenditure.
“The measures, the biggest one is going to be debt restructuring, when that happens I expect the rate of the Cedi depreciation to slow down.”
Some forex bureaus are selling the local currency between ¢12.50 and ¢12.95.
The Cedi has been reported by Bloomberg to be the world’s worst-performing currency this year as investors continued to squeeze foreign capital to the west African country before a deal with the International Monetary Fund.
But the Bank of Ghana (BoG) said the fall of the Cedi against the Dollar and also the high inflation rate (32.7%) are temporary.
Second Deputy Governor of the Bank of Ghana Elsie Addo Awadzi expressed confidence of a positive outlook for Ghana’s economy.
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Speaking at the 21st Annual National RCB CEOs conference on the theme ‘Positioning Rural banking at the Centre of Financial Services delivery in Ghana – the role of stakeholders” she explained that recent global developments have heightened economic and business uncertainties for businesses and individuals. Our domestic economy is not spared from these developments.
The Bank of Ghana, she said is working closely with the Ministry of Finance and other key stakeholders to negotiate a sound economic reform programme supported by the IMF, to stabilise and transform our economy.
“We at the Bank of Ghana are confident about the outlook for our economy. The current high inflation and cedi depreciation are temporary, and we must avoid speculative behaviour that only works against attaining stability sooner,” Mrs Addo Awadzi stated.
The BoG earlier identified five key reasons for the woes of the local currency.
They were “The strength of the US dollar, Investor reaction to Credit Rating Downgrade, Non-Roll over of Maturing Bonds, The sharp rise in crude oil prices and impact on the Oil Bill, Loss of External Financing.”
The central bank went ahead to announce measures introduced to resolve the situation.
They were the “Gold Purchase Program to increase foreign exchange reserves; Special Foreign Exchange Auction for the Bulk Distribution Company’s (BDCs) to help with the importation of petroleum products; Bank of Ghana is entering into a cooperation agreement with the mining companies to provide BOG with the opportunity to buy gold as when it becomes available.
“The Bank of Ghana is supporting the banking sector with foreign currency liquidity to help meet the demand for external payments. The recently approved USD750,000,000 Afrexim loan facility by Parliament, once disbursed, will boost the foreign exchange position of the country and help restore confidence.”
The recently signed 1.13billion dollar Cocoa Syndicated loan was also a measure to shore up the Cedi, the BoG added.
