The Cedi is bound to further depreciate against the US dollar in the coming months, the Institute of Statistical, Social and Economic Research (ISSER) has predicted.
Speaking at a press conference on Tuesday, Director of the Institute, Professor Felix Ankomah Asante, said the cedi will depreciate slightly more than it did last year.
‘It’s expected that the Cedi will depreciate slightly more than the 2017 levels because of the current rise in interest rate in the US market and the gradual increase in the proportion of foreigners holding Ghana’s domestic bonds,’ he explained.
Many Ghanaians have lamented the current state of the cedi, with a dollar now being traded at almost 5 cedis at the various banks. The cedi depreciated by 5.3 per cent in the first six months of 2018, compared to 3.3 per cent in the first half of 2017.
Meanwhile, government has defended its management of the cedi, despite the currency’s rapid depreciation against US the dollar.
Vice President Dr. Mahamudu Bawumia maintains that the fundamentals of the economy are strong, contrary to views held by critics that certain government policies have weakened the cedi.
According to him, the depreciation of the Cedi against the dollar has been only seven per cent because ‘over the last few months the US dollar internationally has strengthened against all the major currencies in the world’ because the US federal reserve has increased its interest rate.
Dr. Bawumia explained that the exchange rate of the cedi to the dollar has remained ‘relatively stable’ than other currencies against the US dollar.