Economist questions BoG over Cedi appreciation days before election

The local currency, the Cedi, has depreciated against major trading currencies such as the US dollar, Pounds Sterling, and Euro over the past months.

As of November 1, 2024, the Cedi was selling at GH¢16.26 to a dollar and ended the month at GH¢15.49 to US$1 and GH¢19.59 to a Pound Sterling.

On Thursday, December 5, 2024, the Cedi regained some strength after the central bank injected money into the system to stabilize the local currency.

The Central Bank lowered the dollar rate to GH¢14.92 from GH¢15.10 recorded the previous week.

The Pound Sterling is now being bought at GH¢18.9464 and sold at GH¢18.9668. The Euro is also being bought at GH¢15.6984 and sold at GH¢15.7125.

Reacting to this, Dr. John Kwakye, an economist and Director of Research at the Institute of Economic Affairs (IEA), questioned the sustainability of the Cedi's resurgence.

In a tweet sighted by GhanaWeb Business, Dr. Kwakye asserted that the Cedi's appreciation is due to deliberate intervention by the Bank of Ghana as Ghanaians prepare to vote on Saturday, December 7, 2024.

He stated that the Cedi's appreciation has nothing to do with improvements in the country's economic fundamentals.

"Recent Cedi appreciation is due to deliberate intervention by BoG ahead of the election. It's got nothing to do with improved economic fundamentals. The real test will come after the election," part of his tweet read.

“But why now? And what is going to happen after the election? Or is it a matter of seek ‘ye’ first election victory and all other things will be yours?” he added.

Meanwhile, the Minister of Finance, Dr. Mohammed Amin Adam, has stated categorically that the local economy has rebounded stronger than before.

Addressing the press on Tuesday, December 3, 2024, he said there has been a growth of 5.8% and the inflation rate has taken a downward trend.

Additionally, fiscal discipline has been maintained despite the economic crisis the country witnessed earlier.

Dr. Amin Adam indicated that the country’s growth was largely influenced by ICT and digitalization.

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