Investor confidence will continue to decline until inflation is stabilized – Lord Mensah

Economist calls on govt to complement monetary policy with sound fiscal measures

Inflation hits 23.6%

Investors shying from treasury bills

Economist, Professor Lord Mensah has stated that investors keep shying away from investments in the country due to the rising inflation.

He wants the Finance Minister, Ken Ofori-Atta to institute comprehensive fiscal measures to complement monetary policy measures by the Bank of Ghana.

This he believes will restore economic stability and confidence.

Meanwhile, analysts have projected that with the current inflation rate of 23.6% investors will continue to show low level of interest in Treasury bills if no concrete fiscal policy measure is taken.

Speaking to JoyBusiness, Prof. Lord Mensah noted, “Government has been struggling to meet its target because the investor community has started shying away from short-term investments.”

He added that because investors are always looking to maximize their investments, they respond to happenings on the international market therefore when there are uncertainties they become skeptical.

“Usually when uncertainties are so high in the system, most of the investors move their funds from the long term to the medium term. If the uncertainties continue to get deeper, they move their funds to the short term. If the investor is not comfortable in the short term, then it means the economy is not doing well,” he explained.

“With high inflation, investors know that the value of their investment will be eroded. For me, the most important thing to do now is to work and bring inflation down”.

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