The Bank of Ghana has finally responded to accusations that it has been manipulating foreign exchange rate figures.
Former Deputy Governor of the BoG Dr. Mahamadu Bawumia, a member of the Parliamentary Select Committee on Finance Kwaku Kwateng and other analysts have all accused the central bank of forging forex figures.
According to Dr. Bawumia, the BoG has created a false impression that the exchange rate data has remained fixed over the last three months.
He said, “A simple look at the the interbank market exchange rates indicates that the cedi has not only been depreciating daily, but is currently trading between GHC3.7 and GHC 4.1 per dollar with an average of some GHC3.8 per US dollar.”
Responding to the allegations at a press conference after the Monetary Policy Committee (MPC) meeting on Wednesday, Governor Dr. Henry Kofi Wampah blamed the current situation on various factors.
He said, “we believe the rates in the market are also affected significantly by speculative activities, which is thriving on the shortage of forex in the market. So those who have the forex try to play market by asking for the highest rates and the ones who to buy because of desperation also tell their banks to buy at any rate, so you see that gap.”
He further explained how the exchange rate is determined saying, “the way we determine the exchange rate now, we have a Reuters platform and the rates on the ,which the banks trade among themselves, including the Bank of Ghana, is averaged, and that is what give you the interbank rate which we(BoG) report. But because of lack of liquidity in the system, until recently, there was no trade at all on the interbank market. So what the banks were doing was just trading with their customers, buy from one customer and to the other.”
“And this gives us a narrow area to determine what will be the reference rate in the interbank market,” he added.
Meanwhile after assessing the health of Ghana’s economy, the Monetary Policy Committee (MPC) of the Bank of Ghana has maintained the policy rate at 19%.
This was after assessing both domestic and external factors that have direct impact on Ghana’s economy.
On the domestic front, Governor of the Bank of Ghana Dr. Henry Kofi Wampah said there is some stability in the foreign exchange market because of the central bank’s last policy review.
He however said “exchange rate volatility and fiscal pressures continue to pose challenges to the economy.”
Externally, cocoa prices have recovered a situation which the Governor described as “positive development for the external sector going forward.”
By: Nana Boakye-Yiadom/citifmonline.com/Ghana
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