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Ghana cedi is a 'junk currency' going down the tubes — US economist Steve Hanke

US Economist, Prof. Steve Hanke has yet again criticized the gains Ghana cedi is making against the dollar.

Ghana cedi

Since the start of the year, the professor of applied economics at the Johns Hopkins University in Baltimore has been downgrading the Ghanaian economy and criticized President Nana Addo Dankwa Akufo-Addo's government when the cedi became the worst-performing currency in the world.

Despite the local current appreciating over 60%, Prof. Hanke is still not convinced the gains the cedi is making are sustainable.

Once again, he has forecasted that the Ghanaian cedi is going down the tubes.

In a Twitter post, Professor Steve Hanke described the cedi as a 'junk currency'.

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He wrote "In #Ghana, the #cedi is going down the tubes. By my measure, the cedi has depreciated ~49.32% against the USD since Jan. 1, 2022. Thanks to Ghana, my rogue's gallery of JUNK currencies just keeps growing."

The depreciation of the Ghanaian cedi negatively affects imports and intensifies local inflation.

The local currency has depreciated sharply against major currencies, in particular the U.S. dollar since 2022.

As of January 30, 2023, the cedi depreciated by a substantial 19.1 percent to the US dollar.

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According to the Summary of Economic and Financial Data from the Bank of Ghana, the cedi sold at GH¢10.60 to one US dollar in January 2023 on the interbank market, compared with GH¢8.57 in December 2022.

The central bank, however, pegged the cedi depreciation to the American greenback in 2022 to 30 percent.

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