The Head of the Department of Finance at the University of Ghana Business School, Professor Godfred Bokpin, has said weak fundamentals cannot be the cause for the depreciating cedi but rather external shocks.
Speaking to TV3’S Nuong Faalong on Tuesday, Professor Godfred Bokpin explained that the fundamentals of the economy have been looking positive and therefore the loss in value of the Cedi cannot be blamed on weak economic fundamentals.
He said the present state of the Cedi is as a result of external forces and the inability of it to withstand unexpected market shocks, adding that other countries have suffered the same fate as a result of the market forces.
“What we are seeing right now is more externally driven with prospects of attractive securities in the US and the merging market, and the fact that growth in US is picking up and consolidating, and that is offering hope for investors.”
The Ghana cedi today is changing for GHȻ4.82 to a $1 after hitting GHȻ4.85 last week.
Politicians and economists have not been able to agree on the true cause of the falling value of the Cedi.
Professor Bokpin defended probable decisions of resorting to foreign reserves to shore up the value of the Cedi.
He further lauded efforts of the Central Bank but cautioned politicians against politicizing the Cedi.
Professor Bokpin called on domestic investors to avoid panic decisions as they could further jeopardize the local currency.
Source: 3news.com| Ghana