The Bank of Ghana (BOG) is projecting that the cedi may appreciate significantly against the dollar and other foreign currencies like the British Pound and Euro at the last quarter of 2016.
According to the Governor of the Central Bank Dr. Abdul Nashiru Issahaku inflows from the 1.8 billion cocoa syndicated loan, 750 million Eurobond recently issued and other inflows from donor partners will further stabilize the cedi.
The cedi has seen some level of stability this year (2016).
Data from the central bank shows the cedi depreciated by 4.1 percent against the dollar as at early September 2016 against 14.8 percent in September last year.
The Governor of the Bank of Ghana Dr. Abdul Nashiru Issahaku in an interview with Citi Business News said that the cedi will continue with the gains made till the close of the year.
“I must say that bringing all this together with the liberalized foreign exchange market will never see any depreciation as we end the year 2016 and if for nothing at all the cedi may rather appreciate against the dollar and other foreign currencies.”
Dr. Issahaku further explained that the tightening of the fiscal and monetary policies has also played a part in stability of the cedi.
“We must also add that the inflows of the cocoa syndicated loan, Eurobond proceeds and donor funding will see the cedi further hold its value.”
Some economists and financial players have however predicted further depreciation of the cedi due to activities of speculators, traders and the upcoming elections.
The Central Bank Governor however rejected the assertion that the cedi has always depreciated getting to the end of the year.
“Remember that most of the depreciation that took place last year happened before the second half of the year so it is not always the same that the cedi will depreciate getting to the end of year.”
“You must also know that the stability of the cedi is as a result of confidence in the economy”. He stated.
By: Norvan Acquah – Hayford/citibusinessnews.com/Ghana