An Economist Prof Godfred Bokpin explained that the various strategies implemented by the government will result in a more stable currency in the second quarter.
He explained to Accra-based Citi FM that the various strategies implemented by the government will result in a more stable currency.
He said the renegotiation of the IMF deal and the rising investor confidence play key roles in the stability of the cedi.
“The next IMF review is likely to be positive, that will also inject some good news into the economy and help generate market confidence and unlock donor inflows into the economy. With a change in government and the goodwill that comes with Akufo-Addo’s government, we expect that donor partners will respond with the appropriate measure, with some level of inflows into the economy, the next tranche of the IMF money should also help.”
“I expect the stability to continue. I think that a significant stability of the cedi is sustainable. In fact beyond that, it is not even sustainable for our economy itself in terms of the competitiveness of our economy,” he added.
The cedi saw some depreciation during the first quarter of this year.
Latest figures by the Bank of Ghana also showed that the cedi’s depreciation against the dollar for March 2017, was five times more than the rate of depreciation recorded in the same period in 2016 thus from 0.9 to 5 percent.
In March 2017, the local currency depreciated by 7.5 and 8 percent to the British Pound and the Euro respectively.
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However, Prof Bokpin said the cocoa syndicated loan that may be raised soon, will guarantee further inflow of cash to help stabilise the cedi.
“Beyond that government will soon begin negotiating in terms of the net syndicated cocoa loan and others so probably, speculators will have to take a slip in a bit and then wait and see what happens. But at least some level of stability should be anticipated,” he concluded.