The Central Bank has pinned its hopes on fresh dollar inflows from overseas to arrest further depreciation of the Ghana Cedi.
Over the past few months, the Cedi has depreciated against the dollar posing many challenges to importers who have had to pay more to obtain dollars to pay for their consignments.
Governor of the Bank of Ghana (BoG), Dr Kofi Wampah, in a speech at the launch of the 2013 Banking Survey results, said the depreciation of the Ghana Cedi would soon be a thing of the past.
He said the inflows, coupled with new monetary measure, would help to halt the Cedi’s free fall.
Noting that most of the inflows arrive in the fourth quarter, he said about $1.2 billion is expected in the fourth quarter of this year.
For the rest of the year, the inflows are not that heavy.
He also stated that the country’s terms of trade had suffered some decline this year even in the prices of commodities like gold, cocoa.
“We see these things picking up in the second half. Also the impending Euro bond issue will be another source of foreign exchange inflow.”
Noting that the fluctuations in the currency’s value could not continue going forward, he described the trend as seasonal given the demand and supply periods.
In the first half of the year, he said a lot of seasonality is experienced because of the increase in demand, adding that most institutions settle their import bills after the Christmas festivities, among others.
Philomena Nyarko, Government Statistician, at the launch of the May 2013 inflation rate, indicated that the depreciation of the Cedi could have serious implications for the country’s economy.
Since January, this year, the Cedi’s depreciation has been around five percent against the dollar, analysts argued.
Currently, a little over two Ghana cedis would be required to obtain a dollar.
By Samuel Boadi