How shortage of dollars can ‘pave way’ for cedi stabilization

Financial Analyst at Dalex Finance, Joe Jackson, is optimistic the local currency – Cedi – will soon stabilize and trade among major trading currencies, especially the US dollar.

According to him, dollars will soon not be on the market due to the unwillingness of Ghanaians to purchase the currency at a high price.

Speaking on TV3’s Ghana Tonight programme, Joe Jackson noted that government, on the other hand, will soon announce its domestic restricting policy to salvage the current economic hardship fraught Ghanaians.

“It is a tough time but I expect that the rate will slow down. The rate will slow down because at this moment, it is very hard to find dollars to buy and most of the people we have, are giving up on buying dollars and are slowing,” he said.

“Very soon there will be no dollars in the market and we are going to see some stabilization because the government will announce domestic debt restructuring package,” Joe Jackson added.

Bloomberg on Thursday, October 20, 2022, reported that Ghana’s local currency – the cedi – has depreciated in value by 9.6%.

This, the news portal said, makes the total loss of the cedi in 2022 almost 52%, the highest recorded in 22 years.

The free fall of the cedi now places the currency at the 148 position of worst performing currencies in the world.

Meanwhile, Ghana is targeting an amount of $3 billion over a three-year period from the IMF once an agreement on a programme is reached.

The new amount requested as a loan is double the government’s initial target of $1.5 billion.

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The IMF programme is aimed at restoring macroeconomic stability and safeguarding debt sustainability among many others.