Member of Parliament for Bolgatanga Central, Isaac Adongo, has criticized the Akufo-Addo administration for lacking effective strategies to stabilize the Cedi.
Mr Adongo said, “The NPP clearly has no solution for the ongoing decline in the Cedi’s value. Businesses have already lost capital due to exchange rate losses, and the dollar is expected to reach 17 Cedis soon.”
The Ghanaian Cedi has surpassed GH¢16 against the US Dollar in the currency retail market.
However, Finance Minister Dr. Mohammed Amin Adam, in his monthly update on the economy on August 30, said that the Cedi has largely stabilized against major trading currencies since 2023, despite facing some recent pressures that have since eased.
He reported that the Cedi’s depreciation against the US Dollar improved from 54% in November 2022 to 27.8% in December 2023, compared to 30.0% in December 2022.
“The Cedi’s depreciation has been easing, with month-on-month depreciation against the US Dollar improving significantly from 6.1% in May 2024 to 3.1% in June 2024, and further to 2.1% in July 2024. This relative stability can be attributed to several factors: the Bank of Ghana’s tight monetary policy, strong fiscal consolidation, the gold-for-oil and gold-for-reserves programs, the introduction of a centralized platform for Foreign Exchange Bureaus, the implementation of the dynamic Cash Reserve Ratio (CRR) to manage excess liquidity, revised regulations on advanced payments for imports, and positive market sentiments following the disbursement of the third tranche of the IMF Extended Credit Facility.”
In the first quarter of 2024, the Cedi’s depreciation slowed to 7.7% compared to 22.1% during the same period in 2023.
By the end of June 2024, the Cedi had depreciated by 18.6% against the US Dollar, an improvement from the 22% depreciation recorded in June 2023.
As of August 26, 2024, the Cedi’s cumulative depreciation stood at 21.5% against the US Dollar, slightly better than the 22.1% depreciation observed in August 2023.