Chief Executive Officer of Dalex Finance, Joe Jackson, has attributed recent fluctuations in the Ghana cedi to deliberate measures by the Bank of Ghana, stressing that the current exchange rate reflects a more sustainable economic path.
In an interview on Channel One TV, Mr. Jackson reviewed the cedi’s performance over the past six months under President John Dramani Mahama’s administration.
“Indeed, when you look at what happened, the central bank was intervening in the market. So long as the Central Bank was intervening, the rates were around 10, 11. Then the Central Bank announced that it won’t intervene anymore. And as soon as it announced that it won’t intervene, what happened? The rate shot up from 10, 11 to the 12 plus,” he explained.
He argued that the cedi’s current level, above GH¢12 to the dollar, is a “far more defensible position” for the Central Bank compared to the earlier GH¢10.5 rate, which, though encouraging in the short term, was overvalued and unsustainable.
“But it is my opinion that the rate of 12 plus is a far more defensible position for the Central Bank than 10.5. And that the 10.5, even though it had a really feel-good factor and everybody became bullish, over time because of how much the cedi was over-valued, would have brought us challenges,” he added.
Mr. Jackson’s remarks underscore the Bank of Ghana’s cautious strategy of prioritizing long-term currency stability and sustainable management over short-term market excitement during the early months of the Mahama administration.
Source: Adomonline
