Ghana's local currency, cedi note and pesewas
A lecturer with the Department of Finance at the University of Ghana Business School, Dr. Benjamin Amoah, has categorically stated that the fundamentals of the local economy are weak.
According to him, the weakening of the local currency, the cedi, along with high interest and inflation rates, are causing more harm than good as they show that the economy has taken a nosedive.
Speaking in an interview on Joy FM, Dr. Amoah also lamented the high unemployment rate in the country.
He said, "The fundamentals are definitely weak. We should not joke about it. The truth is that the fundamentals are very weak. What are the fundamentals here? What is the inflation rate as we speak now, and what has been the inflation rate over time? Very high. What is the interest rate, which is a fundamental factor? It is very high."
"What is the unemployment rate now? The unemployment rate is very high. What is our balance of payment position? It is very negative, and these are the very fundamentals that are used in assessing the exchange rate," the finance lecturer stated.
The cedi currently sells at GH¢14.85 at various forex bureaus, with the inflation rate pegged at 25.0%.
Bloomberg, a financial and media company has predicted that the value of the cedi will depreciate further by the end of the year.
According to Bloomberg, the cedis is expected to reach a value of GH¢15.98 against the dollar.
It would be recalled that Vice President, Dr. Mahamudu Bawumia, in 2014 said, "if the fundamentals are weak, the exchange rate will expose you."
His comment came at a time when the cedi was witnessing continuous depreciation under the Mahama-led administration.
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