Economist Professor Peter Quartey has advised the Bank of Ghana to tread cautiously over any intervention of trying to stabilise the cedi.
The local currency has come under sustained pressure against the major trading currencies
The local currency is today trading against the dollar at GHS5.77015
This calls for measures that will prevent the continuous depreciation of the cedi.
Professor Peter Quartey said this will not be the appropriate time for the Central Bank to pump in more money from the reserves.
According to him, the current measures in place should rather be focused on because the world does not know how long the pandemic will stay with us.
“If you pump in too much of your reserves at this point and later when God forbid, the situation becomes more severe we won’t have the reserve to step in and that will be more devastating so I think we need to tread cautiously not to pump in more money. At the moment, some of the measures put in place like the forex……….and the likes we are seeing some results and they should pursue most of these for now..”
Coronavirus causes cedi’s depreciation
The deadly coronavirus has negatively impacted on Ghana’s cedi.
Ghana’s cedi is showing signs of depreciation after the continues spread of the coronavirus.
The development is as a result of some offshore investors getting out of Ghana’s bonds and turning to gold as a safe haven.
According to reports, most of these investors who had an interest in our bonds are taking the decision as one of several means to protect their investment.
There are fears that the coronavirus might not be ending anytime soon, forcing some of the investors out of our bonds and now investing in gold.
The move has affected the cedi as it has come under some pressure, moving from GHS5.35p and now selling at GHS5.41874p
The fear is that if the coronavirus is not contained anytime soon there might be more pressure on the local currency and this could affect the gains of the Central Bank which has resulted in the appreciation of the cedi since January.