Director of Research at the Institute of Economic Affairs (IEA), Dr. John Kwakye, has expressed concern over the rapid depreciation of the local currency against major trading currencies, particularly the US Dollar, Pound Sterling, and Euro.

He stated that the Cedi has lost 75% of its value.

Following the Bank of Ghana's decision to lower the monetary policy rate to 27% from the previous 29%, Dr. Kwakye emphasized the need for government intervention to stabilize the Cedi.

In a post on X, sighted by GhanaWeb Business, the IEA boss said, “I welcome the MPC decision to cut the PR from 29% to 27%. This was long overdue. I expect more cuts to follow. I am, however, disturbed by the pace of depreciation. From 4 to the dollar to 16 now, the Cedi has lost 75% of its value during the period. This is unacceptable! #SaveTheCedi.”

He also called for a reduction of at least 200 basis points in the monetary policy rate, in line with the sharp drop in inflation from 54% to 20% during 2022-2024.

On September 27, 2024, the Bank of Ghana announced a 200 basis-point reduction in its monetary policy rate, lowering it to 27%.

This second rate cut since 2021 aims to provide relief to borrowers and reflect the easing of inflationary pressures.

The Governor of the Bank of Ghana, Dr. Ernest Addison, noted that the decision was influenced by a favorable economic outlook.

He explained that since the first quarter of the year, headline inflation has declined for five consecutive months by 5.4 percentage points.

Read his post below:

I welcome the MPC decision to cut the PR from 29% to 27%. This was long overdue. I expect more cuts to follow. I am, however, disturbed by the pace of depreciation. From 4 to the $ to 16 now, the cedi has lost 75% of its value during the period. This is unacceptable! #SaveTheCedi

— J. K. Kwakye (@JohnKwabenaKwa1) September 29, 2024