Ghana's local currency has lost 53.8% of its value against major currencies since the beginning of this year, according to Finance Minister Ken Ofori-Atta.

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While presenting the 2023 budget statement in Parliament on Thursday, Ken Ofori-Atta revealed how certain economic activities this year in particular have contributed to the cedi’s depreciation.

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He cited the rise in demand for foreign currency as one of the causes of the cedi's depreciation.

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“The demand for foreign exchange to support our unbridled demand for imports undermines and weakens the value of the cedi. This contributed to the depreciation of the Cedi which has lost about 53.8% of its value since the beginning of this year, compared to the average 7% annual depreciation of the Cedi between 2017 and 2021,” he mentioned.

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Between 2017 and 2021, the annual depreciation of the cedi stood at 7 percent.

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Among major trading currencies, the Ghana cedi has fared worse against the United States dollar.

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In October this year, the value of the dollar against the cedi rose to GH¢16 from GH¢6.8 in January this year.

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Information from the Bank of Ghana reveals that as of November 23, 2022, a dollar was trading at GH¢13.11. Interbank rates pegged a pound at GH¢15.78, and traded a euro at GH¢13.59.

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At the forex bureaus, a dollar is sold at GH¢14, while a pound and euro are sold at GH¢17 and GH15 respectively.

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Due to the depreciation of the cedi, there has been an incessant hike in fuel prices, which has resulted in an increase in transport fares.

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The high cost of transportation has translated to a rise in the cost of goods and services in the country.

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Meanwhile, the government has introduced some measures to curb the depreciation of the cedi.

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The Central Bank has been working with the mining firms, international oil companies, and their bankers to purchase all foreign exchange arising from the voluntary repatriation.

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Source: The Independent Ghana

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