Bank of Ghana introduces new measures to stabilize the cedi.
4/30/2012 2:01:48 PM -
The Bank of Ghana has announced additional measures to hault the continuous decline in the value of the cedi.
The Central Bank is blaming the continuous depreciation of the cedi on the speculative activity of currency traders in the inter-bank foreign exchange market.
The Monetary Policy Committee of the Central Bank recently increased the policy rate among others measures to improve stability of the cedi.
In a statement, the Central Bank says it has introduced 3 more measures which take effect from tomorrow.
The measures include the re-introduction of 30, 60, 90 and 270 day Bank of Ghana Treasury bills apart from Government of Ghana's treasury bills currently on the market. This is expected to mop up the excess cedi on the market and give investors more cedi instruments to invest.
Commercial banks are also required to keep a mandatory 9 percent of their total domestic and foreign deposits at the Bank of Ghana only in cedis henceforth.
The Banks are also required to provide 100 percent cedi cover for all Vostro balances held by their foreign banks in the country at the Bank of Ghana.
The measures follow a string of losses that has seen the local currency depreciate by 11 percent since the beginning of the year to date. You'd need 1 Ghana cedi 85 pesewas to buy the dollar as at last Friday on the forex market.
Story by Emmanuel Agyei / George Wiafe - Joy Business