President Mahama reveals the secret behind the cedi constant appreciation against the dollar
President John Dramani Mahama has disclosed the measures coordinated by the Central Bank and the Finance Ministry to give the cedi vitality against the dollar and all other trading currencies.
He stressed that the recent gains made by the cedi are not artificial, but the result of strong coordination between the Finance Ministry and the central bank.
“The cedi’s appreciation in value is the result of close coordination between the fiscal and monetary authorities — the central bank and the Ministry of Finance — and it is based on the Forex auction and demand and supply.
“What happens is, the Bank of Ghana does the Forex auction, finds out how much cedi is in the system that needs forex to pay various bills and others, and those who want the forex bid on the auction. The Bank strikes the average and takes the cedis and makes the dollars available. So it’s not like somebody is deliberately forcing the dollar down,” explained the President.
The President says he does not expect the Ghana cedi to appreciate to the point of selling at par with the United States dollar.
According to him, such a development would be extreme and harmful to Ghana’s export sector.
Speaking to members of the business community on Wednesday, May 28, President Mahama said the Bank of Ghana will step in to regulate the appreciation and keep the cedi within its fair value.
“And so I don’t envisage that the currency will come down to sell at GHS1 to $1. No, that’s extreme. It will eventually collapse our export sector if that happens.
“But I think the Governor of the Bank has an eye on it, and if it goes below a certain floor, I’m sure the Bank of Ghana will make an intervention to make sure that it remains within a certain band that gives the true value of the cedi against other foreign currencies. So don’t panic,” the President said.