The rapid depreciation of the Cedi against the major foreign currencies such as the US Dollar, Pounds sterling, Euros and CFA has robbed Ghana’s currency the chance to be at par with other national bank notes.
In 2014, the Ghana Stock Exchange (GSE) noted that there was a sharp decline in the currency as one US dollar was traded at 2.1616 cedis.
The currency losing its value had a dire consequence on traders and calls were made to government to devise strategic means to stabilise the local currency.
Yet, six years down the line, the situation is still the same as the cedi lost almost 13 percent of its value to the US dollar compared to the same period in 2018.
To curb the dire situation, a 38-member Foreign Exchange Development Committee (FX Committee) has been set up to review the country’s foreign exchange regime, identify constraints and offer workable alternatives that can reduce risks to the economy.
Currently, the cedi is being traded at US$1 to GH¢5.54.
Read the full story originally published by dailyguidenetwork.com below:
The Ghana Cedi has depreciated continuously against major foreign currencies on the forex market since the beginning of the year.
The Ghana Cedi traded at US$1 to GH¢1.8800 at the beginning of 2013 but ended the year at US$1 to GH¢2.1616, a 15.0 percent decline, latest statistics released by the Ghana Stock Exchange (GSE) indicated.
The local currency loses its value on a daily basis, and the problem, if not checked early, could spell doom for importers and traders alike.
Already, the Ghana Cedi has depreciated by close to three percent, this year.
Business Guide conducted a brief survey of the market in certain parts of Accra recently where black market traders operate.
At the Kwame Nkrumah Circle Total Filling Station, a dollar was buying at GH¢2.30 and selling at GH¢2.41 while at the Kotoka International Airport Bus Stop, the green buck was buying at GH¢2.36 and selling at GH¢2.43.
At Tudu yesterday, it was buying at GH¢2.40 and selling at GH¢2.48 even though official reports from the Bank of Ghana (BoG) indicated that it was buying at GH¢2.2988 and selling at GH¢2.3013
Owing to the trend, Seth Terkper hinted of government’s intention to strengthen existing foreign exchange laws to help halt the free fall of the cedi.
According to him, new regulations and the enforcement of the laws were needed to help stabilize the local currency.
Vice President Kwesi Amissah Arthur recently directed the Finance Ministry and the Bank of Ghana (BoG) to quickly stall further depreciation of the cedi against major currencies.
The Central Bank Governor and his team could go to Parliament to reinforce their regulatory control of the currency under the current circumstances.
The Cedi is expected to further decline in value in the coming months and could end the year with an abysmal performance against the dollar, analysts have predicted