Acting Chief Executive Officer of the National Petroleum Authority (NPA), Godwin Edudzi Tameklo, has praised the managers of Ghana’s economy for maintaining relative stability in the cedi over the past eight months, despite recent depreciation pressures.
Mr. Tameklo said the calmness witnessed earlier in the year was the result of effective management, and the current turbulence should not overshadow those gains.
“We need to applaud the managers of the economy in the past eight months for the relative stability we have seen. The recent pressure is not because they have failed, but because speculation has been allowed to thrive in the absence of communication,” he said.
According to him, much of the current depreciation is being fueled by speculation, particularly because the market has not yet heard key announcements such as COCOBOD’s annual syndicated loan, which usually reassures traders and stabilizes the currency.
“In a normal year, by now COCOBOD would have secured its $1.2 billion facility, and the news would be out. These announcements calm the market, but the silence this time has allowed speculation to drive the rate from 10 to almost 12 and beyond,” he explained.
Mr. Tameklo further noted that the cedi’s movement must be understood within Ghana’s cyclical forex patterns.
He pointed out that demand usually rises twice each year, between March and April, when companies with December year-end publish accounts and move funds, and between September and November, when import demand peaks ahead of Christmas.
“By March, funds begin to move out as companies publish results. Later, by September and October, imports for Christmas kick in. These two windows always put pressure on the currency,” he said.
The Acting CEO added that Ghana’s heavy consumption during the festive season also contributes to forex pressures.
“If you look at the data, the things we consume during Christmas are amazing. We eat everything, and that demand reflects directly in forex needs,” he observed.
