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Bank of Ghana to pump $800 million into economy to stabilise 'weak' cedi

The Bank of Ghana has announced that it will release some <a id="13c10e49-398d-4f95-a3de-040b8b76a496" href="https://www.pulse.com.gh/news/local/flashback-cedi-depreciation-worse-under-mahama-bawumia/4frg548">$800 million onto the market</a> to curb the cedi's depreciation.
Cedi
Cedi

The Central Bank said it expects the cedi to stabilise against major international currencies especially the dollar.

Market analysts said the cedi has depreciated and is currently trading at around GH¢5.45.

According to the Head of Financial Markets at the central bank, Steven Opata, the accumulation of more dollars would help increase the net international reserve (NIR) to around $4 billion, enough to provide confidence in the system and help stabilise the free fall of the local currency.

READ MORE: Cedi Depreciation: Ghana’s economic fundamentals still solid – BoG

He said one of the strategies it was adopting "is rebuilding reserves to face more systemic shocks that may come."

"I am very optimistic that it will not be long before we see stability and some recovery in the cedi," he added.

Opata explained that research by the Central bank shows that the recent depreciation would normalise in days, as it was not caused by weak fundamentals and external shocks but by local sentiments that tended to correct with time.

"In this first quarter, the movement in the cedi is not caused by external factors because the external sector has been quiet," he said.

Meanwhile, President Nana Addo Dankwa Akufo-Addo has assured the public that his government is working assiduously to arrest the decline of the cedi.

He admitted that the declining rate of the cedi is upsetting and insists he is anxious to overturn the situation.

READ MORE: Where are the managers of the cedi? - Franklin Cudjoe quizzes

"I am extremely upset and anxious about it too, but I want to assure you that all efforts are being made to arrest the decline and restore the cedi to stability, in order to improve the competitiveness of Ghanaian industry. Very soon, we will be seeing the results of our policy," Nana Addo said.

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