Cedi Appreciation Driven by Coordinated Fiscal and Monetary Efforts, Not Deliberate – Mahama

President of Ghana H.E John Dramani Mahama has explained that the recent appreciation of the Ghana Cedi is due to close coordination between the fiscal and monitoring efforts of the central bank and the Ministry of Finance.

Speaking earlier today during the multi-Sectoral engagement on 24-hour economy policy implementation at Jubilee House emphasized that, the forex auction process is described, where the Bank of Ghana determines the demand and supply for cedi needing Forex to pay various bills.

“The Cedi recently has appreciated in value, and it is the result of close coordination between the fiscal and monitoring between the central bank and the Ministry of Finance, and it is based on the Forex auction and demand and supply. What happens is the Bank of Ghana does the Forex auction finds out how much Cedis in the system that need Forex for to pay various bills and others.” He explained.

He emphasized on those who want Forex bid on the auction, and the bank strikes an average price to make the dollars available.

President Mahama stated that the appreciation of the cedi is not due to deliberate manipulation but rather the result of market forces.

“ And so it’s not like somebody is deliberately forcing the dollar down. It is the result of the bits that is finding what the true value of the cedi is, and I believe that it will arrest where the true value is based on the issues of demand and supply.” He added.

President indicated, that the true value of the Cedi is determined by the bits of the Forex auction, which considers demand and supply.

He believes that the cedi value will stabilize at a certain level, rejecting the idea that it will reach one cedi to one dollar.

“ And so I don’t envisage that, Some people say it will come to 1 cedi, $1 No, that’s extreme. We’ll eventually collapse our export sector if that happened.” He highlighted.

President Mahama warns that such an extreme scenario would negatively impact the export sector.

He added that, the governor of the Bank of Ghana is expected to intervene if the cedis value falls below a certain floor to maintain its stability.

He reassures that the Bank of Ghana is monitoring the situation closely and will intervene if necessary to prevent the cedi value from falling too much.

“But I think that the governor of the Bank has an eye on it, and if it goes below a certain floor, I’m sure that the Bank of Ghana will make an intervention to make sure that it remains within a certain band that gives the true value of the cedi against other foreign currencies, so don’t panic.” President assured.

President Mahama suggests that those who haven’t changed their dollars yet may not need to do so soon, as the market conditions are being managed.

“ And if you haven’t changed your dollars already. I don’t know how much further low it will go, but the governor has an eye on it and we’ll see how things go.” He reassured.