Global Factors Part of The Reasons Behind Cedi Appreciation over Dollar Recently – Dr. Richmond Attuahene
Economist and Banking Consultant, Dr. Richmond Attuahene, has highlighted a combination of global and local factors as key drivers behind the recent appreciation of the Ghanaian cedi against major trading currencies. Speaking on Kessben TV’s Maakye Show, Dr. Attuahene provided a detailed analysis of the forces at play in what he described as a “positive development” for the Ghanaian economy.
According to him, global commodity trends have played a significant role in strengthening the cedi. “When President Donald Trump took office, the dollar began to lose its strength against gold. Today, gold has moved from $2,800 to $3,500 per pound,” he explained. He further noted that oil prices, which previously hovered around $80 per barrel, have dropped to about $62, while cocoa prices have surged from $4,892 to between $8,000 and $9,000 per ton. Ghana recently sold over 100,000 metric tons of cocoa, a move he believes has positively impacted the nation’s foreign reserves.
Touching on domestic efforts, Dr. Attuahene revealed that Ghana mined about $11.6 billion worth of gold recently, which has significantly boosted the Bank of Ghana’s reserves. “Remittances have also gone up, which has helped to stabilize the cedi,” he said, emphasizing the growing contribution of Ghanaians living abroad to the country’s economic stability.
Dr. Attuahene also credited the current government with demonstrating fiscal discipline, pointing out that it has managed to save about $10 million compared to last year’s budget estimates. “There’s also been a significant reduction in borrowing, and we haven’t even started paying the Eurobond debt yet the first payment is expected in July,” he noted.
He further touched on the political tension leading to the 2024 elections, which he said caused many importers to pause their operations. “Many were in a wait-and-see mode, which helped slow down the demand for foreign currency temporarily,” he added.
On the issue of sustainability, Dr. Attuahene warned that if global gold prices drop or Eurobond repayments begin without strong remittance inflows, the cedi could face fresh pressure. However, he noted that steps taken by the Gold Board such as engaging all seven major gold mining firms and renegotiating deals could help maintain balance.
He also praised the Gold Purchase Policy initiated by former Vice President Dr. Mahamudu Bawumia, saying it left a notable impact. “That policy started the gold buying for the Bank of Ghana reserves before this government took over. Even this administration has commended him for that initiative,” he stated.
When asked whether prices of goods should be reduced immediately due to the appreciating cedi, Dr. Attuahene explained that the market does not adjust instantly. “Some importers still hold stock bought when the exchange rate was high. It’s not that simple ,if the cedi’s strength continues for some time, we will see the changes reflect across board,” he concluded.
The economist stressed the need for Ghana to lay down effective and long-term policies to maintain the current gains. “If we want to see a stable cedi for generations to come, the groundwork must be done now,” he urged.
By: Gifty Bediako Yamoah
