The businesses are confessing that they have started reaping the benefits of the stability of the cedi experienced in the past weeks.
The Ghana Union of Traders Association (GUTA) says the businesses are seeing the positive impact in the form of improvement in business confidence, predictability of the market, and, more importantly, they are recouping the capital they lost during the period of the free fall of the cedi.
In a statement released by GUTA, the trader group showered praises on the Bank of Ghana (BoG) for what it describes as a remarkable effort in stabilising the Ghana cedi against major foreign currencies.
GUTA acknowledges the significant strides made by the BoG in managing the forex market efficiently from January to date. The Association noted that the cedi’s recent gains against the US dollar and other foreign currencies have brought “respite and confidence to the economy,” especially for traders and importers who had previously suffered severe capital losses during the currency’s sharp depreciation in recent years.
“The local currency has gained some strength against the major foreign trading currencies,” GUTA stated, adding that “this positive trend has brought some level of respite and confidence to the economy.”
The Association credited the Central Bank’s monetary policies and interventions, alongside the government’s fiscal discipline, as the driving forces behind this renewed economic optimism.
GUTA believes that these combined efforts have brought hope to businesses, many of whom are beginning to recover previously lost capital and operate with increased certainty.
“Importantly, it has brought a positive speculation and predictability around the foreign exchange space, thereby eroding the notion that the foreign currency is a store of value in the Ghanaian community,” the statement read.
GUTA urged the BoG and the government to sustain the current momentum through continued prudent policies. The Association expressed hope that maintaining this stability would pave the way for a full economic recovery, improve the competitiveness of Ghanaian businesses, and ease the high cost of living for ordinary Ghanaians.
“These prudent measures, if sustained, would lead to full economic recovery and make businesses competitive, increase productivity, as well as alleviate the high cost of living in the country,” the statement concluded.
The Ghana cedi that was trading at GHC 17 weeks ago is currently trading around GHC 13 to the dollar. The Governor of the Bank of Ghana, Dr. Johnson Asiama, explains that the gains is not a result of selling dollars into the market or any artificial intervention.
He touts the significant improvement in the country’s reserves as well as the structural reforms as the reasons for the cedi’s stability. With these reforms, he believes the gains will not be short-lived, declaring that “the era of excessive volatility is coming to an end.”
It is anticipated that these gains made in the cedi’s strength, as confirmed by GUTA, will reflect in the prices of goods and services on the market to give respite to all Ghanaians.
