IMF exit conditions caused exchange rate spikes in March – Bawumia

Vice President, Dr. Mahammadu Bawumia has blamed the depreciation of the cedi the country experienced in March 2019 on some of the exit conditions by the International Monetary Fund (IMF) programme.

According to him, the Bank of Ghana had to implement reforms to ensure an increase in the country’s international reserves in a bid to end the IMF’s extended credit facility arrangement by April.

In March this year, there was widespread concern amongst the general public and the business community, about the depreciation of the Cedi and its impact on their livelihoods.

At the time, critics lashed out at Mahamudu Bawumia, for not being able to save the cedi from free fall especially when he said a New Patriotic Party government will turn such a situation around.

At a town hall meeting on Wednesday however, Dr. Bawumia revealed that Ghana’s quest to exit the IMF programme is partly attributed to the depreciation of the currency in the past month.

Explaining further, Dr. Bawumia insisted that it was practically impossible for the Central Bank to take any action.

He also dispelled rumours that the Bank of Ghana had injected some reserves into the company which is causing the appreciation of the cedi.

Describing such a move as unwise, he said investor confidence has increased because of what he said are the strong fundamentals and the normalization of market forces.

During the period, Director of Treasury at the Bank of Ghana, Steven Opata said the current free fall of the cedi against major trading currencies especially the dollar has nothing to do with Ghana’s economic fundamentals.

He said the current economic fundamentals are good and the central bank expects the cedi to bounce back sooner than later.

Mr. Opata was however hopeful that with measures put in place by the central bank and government, the cedi will surely recover.


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