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'Brexit impact too early to determine'

Dr. Abdul Nasir Issahaku, however, noted that Brexit impact is likely to transmit through the trade sector, foreign direct investments, budgetary support, and the domestic currency market.

Brexit referendum

Dr. Abdul Nasir Issahaku, however, noted that Brexit impact is likely to transmit through the trade sector, foreign direct investments, budgetary support, and the domestic currency market.

He made these observations at the 71st Monetary Policy Committee meeting on Monday, July 18.

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Issahaku said: "The UK’s vote to leave the EU has dominated global developments since the last MPC meeting, and the implications were immediately felt across global currency, commodities and equity markets. Although the sharp depreciation of the pound sterling against major trading currencies has somewhat reversed, the current uncertainties and volatilities in global financial markets may persist until the post-Brexit negotiations commence with the EU."

He continued: "Based on Ghana’s strong relations with both the EU and the UK, the impact of Brexit is likely to transmit through the trade sector, foreign direct investments, budgetary support and the domestic currency market. It is too early to determine the full implications but initial assessments indicate that the local currency appreciated sharply by about 5.7 percent month-on-month against the pound sterling in June 2016, compared with 1.3 per cent depreciation in May, reflecting theBrexit effect. Going forward, the potential fallouts from post-Brexit negotiations will be closely monitored to take the necessary policy actions to dampen any adverse effects on the domestic economy."

Britain voted in a historic referendum to leave the European Union in June 2016.

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