The Vice President Of Ghana, Dr. Mahamudu Bawumia, says his NPP government has reduced the cedi depreciation rate by 50%.
In an interview with Peace FM,
He said;
“Ghana runs a flexible exchange rate regime and not a fixed exchange rate regime. So the exchange rate will be dependent on the market forces but fundamentally the exchange rate will be determined by the inflation rate, [with] all other things being equal. So if you have high inflation, you will have higher depreciation. If you have lower inflation, you will get a lower depreciation. So that is the fundamental rule. We didn’t say we were going to lock the exchange rate at one rate but essentially lock it within the range of fundamentals such that the lower inflation rate will produce a lower depreciation rate [of the cedi]. Before we assumed office in 2017, the cedi was depreciating at 18 percent annually on average. But during our tenure from 2017 to 2019 it was 8.7 percent on average. So it is 18 percent versus 8 percent. So we have reduced by 50 percent the rate of depreciation of the currency”.
