File Photo, Cedis

The cedi will further depreciate against the US dollar, the Institute of Statistical, Social and Economic Research (ISSER) has predicted.

For the last three months [July to September, 2018] the cedi has performed poorly against major trading currencies, particularly the dollar.

In a press conference on Tuesday, 02 October 2018, the Director at ISSER, Professor Felix Ankomah Asante said the cedi is likely to depreciate more than it did in 2017.

“It’s expected that the Cedi will depreciate slightly more than the 2017 levels because of the current rise in interest rate in the US market and the gradual increase in the proportion of foreigners holding Ghana’s domestic bonds.”

The International Monetary Fund (IMF) has also stated that the lack of effective communication by the government on foreign exchange policies, has partly contributed to the cedi’s depreciation.

The Fund believes that the lack of clarity also made the public resort to speculations which impacted the local currency’s performance.

A report issued by the IMF’s mission that visited Ghana in September said, “Recent exchange rate pressures reinforce the call for fiscal discipline. Going forward, improved communication and coordination would help foster deeper and more liquid FX market.”

Meanwhile, Finance Minister, Ken Ofori-Atta, has insisted that the country’s economy is “on course” despite the recent depreciation of the cedi to the dollar.

“I suspect that nobody will think that in 18 months of restructuring or starting of a business, everything will be done. The question is whether we are on course and yes, we are on course.

“Really, the jitters will come but my true feeling is that, that will stabilize and work out quite well,” he said.

By: Alex Semordzi