President Akufo-Addo has directed an investigation into Ghana’s cyclic currency depreciation after continuous depreciation of the cedi from December last year to March 2019.
Finance Minister Ken Ofori-Atta told Parliament
Finance Minister Ken Ofori-Atta, said “The president has directed that I investigate the structural causes for the depreciation of the cedi and to propose measures to address the situation, the government and I will put a bi-partisan committee together to proceed immediately.”
According to Ken Ofori Atta, the cedi’s appreciation against the U.S dollar over the past three days has been due to the successful issuance of the 3 billion Eurobond and the completion of the 7th and 8th IMF reviews which will lead to the exit of Ghana from the programme.
He added that the two events have given investors’ confidence in the Ghanaian economy.
“The cedi has made great strides of recovery on the back of a successful issue of the 3 billion USD euro-bond and the completion of the 7th and 8th IMF reviews which restored confidence in Ghanaian economy. Currently the Cedi has witnessed substantial gains with the measures we have put in place, there is an existing sound macroeconomic fundamentals. We anticipate the stability of the cedi going forward, indeed the Cedi has appreciated by 5.12% in March 2019 alone as against a depreciation of 2.7% same period last year.”
Finance Minister Ken Ofori Atta proposes two solutions to solving the cedi depreciation, he said: “….enhance the transparency of the foreign exchange market to minimize information asymmetry and panic buying of currency by businesses and by the public when there are seasonal fluctuations in the currency, and develop our capital market, insurance and pension industry to ensure that government domestic borrowing rely less on foreign portfolio investors.”