BoG insists there’s ‘relative stability’ in the exchange rate

The Bank of Ghana (BoG) says the cedi has relatively been stable against the major international trading currencies on the world market, contrary to the impression created by some Ghanaians.

Over the last few days, the cedi has depreciated particularly against the dollar, which was on February 12 pegged at 4.9981 cedis and 5.0031 cedis per dollar for buying and selling respectively, figures from BoG showed.

The popular online currency converter XE pegged the cedi-dollar exchange rate at 5.18502 cedis on the same day.

The Minority in parliament fear the situation could be worse in the coming months, predicting the dollar-cedi rate could hit 5.6 cedis before the end of this year.

Speaking at a currency conference in Accra Tuesday, governor of BoG, Dr. Ernest Addison said all the fundamentals are pointing to the right direction considering the figures from their end.

“In addition, other macro indicators are pointing in the right direction. Growth momentum has picked up, the trade account remains in surplus, and there is also relative stability in the exchange rate,” he said.

This, Dr. Addison noted, is “despite recent volatilities driven by external developments”.

Hosted in by ICCOS, the conference brings together central bankers, commercial bankers and other industry experts to deliberate and share experiences on different aspects of currency cash management, distribution and circulation within the broader payments systems framework.

The governor said President Nana Akufo-Addo’s implementation of strategic policies, including the financial sector clean-up exercise has ensured sound macro indicators and stability.

“The macroeconomic framework put together by the Government focuses on stability. Fiscal Monetary Policy mix was crafted to bring inflation down and anchor inflation expectation.

“The results of the decisive policy implementation are clear. Inflation has been on a downward trend from 15.4 percent in December 2016 to 9.4 percent in December 2018, remaining broadly anchored within the medium-term target band of 8±2 percent,” he said.

He maintained government’s strategy has worked out and all indicators are heading upwards.

Dr. Addison said the currency conference has come at the right time because the “Bank of Ghana is embarking on some crucial reforms aimed at ensuring financial stability and promoting efficiency in Ghana’s payments system”.

He mentioned BoG has taken steps to improve the payment systems infrastructure, alongside strengthening the regulatory frameworks to support the expanding financial technology space.

As part of the reforms which are in the pipeline, he said BoG will make sure the financial sector is secured and paid special attention to improving the features of the Ghana cedi to make it more resilient to counterfeiting threats.