The Ghana cedi will lose all of its value by Christmas this year, according to Afrocentric reggae presenter Blakk Rasta, due to the nation’s ravenous thirst for imports. According to him, Ghana’s unchecked imports of virtually everything from Europe and other western countries is to blame for the cedi’s ongoing decline in value.
On Monday, August 15, 2022, the host of Taxi Driver on Class91.3FM stated his concern in a polemic during the monologue portion of his program (The Black Pot).
What is the current exchange rate between the dollar and the cedi? 9.25. GHS9.25 is one dollar, according to Blakk Rasta.
The Ghana cedi once had a greater value than the US dollar. The Ghana cedi gained value following our redenomination, surpassing the US dollar. He stated, “Today, the American dollar exchanges for 9.25 Ghana cedis.
In order to save the cedi, Blakk Rasta contends that Ghana must generate a lot of goods rather than relying heavily on imports.
Which Ghanaian company manufactures regular balloons? We import toothpicks and balloons both day and night. The Ghana cedi will essentially be toilet paper by Christmas, said Blakk Rasta.
Additionally, he said that some food imports were not what they claimed to be.
“More chicken will be imported into the country around Christmas. On sometimes, I think that the imported chicken is not actually chicken. Some of them may be vultures and crows because, for some of them, you want to wonder, “Eiii, what type of chicken is this?,” when you look at the thigh of the “chicken.”
“And you wonder what fowl has a beak like this, with a mongoloid shape, when you examine the bird’s beak.” A vulture is the only animal with that type of beak. So they bundle vultures, crows, and occasionally even owls to deliver to you for Christmas dinner.
“You are eating it happily… You consume crow, vulture, and “opete.” You have a terrible Christmas, I say. Christmas is coming your way, Blakk Rasta remarked.
If there was ever a bad time to be a Ghanaian, he declared, it is now.
The cedi has lost 3.15, or 32%, of its value against the dollar since the year 2022 began.
Since the local currency’s redenomination in 2007, according to Bloomberg, the cedi’s value relative to the dollar has fallen by 155%.
The cedi’s value against the US dollar ended 2021 at a rate of 6.49; it did so in 2016 at a rate of 4.33.
Bloomberg reported again on August 10, 2022, that due to a decline in the value of the cedi, the price of imported products like cooking oil and gasoline increased more quickly than anticipated in July.
Reporters in the nation’s capital, Accra, were informed by government statistician Samuel Kobina Annim that the annual inflation rate increased to 31.7% from 29.8% a month earlier.
With that rate, the central bank’s goal range of 6% to 10% has been exceeded for the eleventh straight month, which is the quickest pace since November 2003.
In a Bloomberg survey, none of the six economists thought inflation would increase at that rate.
The Sri Lankan rupee has had the worst performance among the currencies tracked by Bloomberg, while the cedi has deteriorated more than 30% against the dollar since January.
Investors have been selling riskier assets and purchasing US dollars as central banks unleash the most aggressive tightening of monetary policy in a decade to curb soaring inflation.
While the central bank may be tempted to increase borrowing costs next month if the cedi continues to fall, pricing pressures are anticipated to start easing as Ghana enters its harvest season and the cost of wheat and other global commodities decline. The monetary policy committee of the Bank of Ghana will next convene in September.
According to Courage, “The trajectory of the currency rate and its pass-through effects on inflation determine when inflation peaks and then declines.” Before the release, Kwesi Boti, an economist with Accra-based GCB Capital Ltd., remarked.
According to Annim, annualized imported inflation was 33.9% in July and has now surpassed annualized domestic price rise for four months. He reported that local inflation was 30.9%. The increase in food prices sped up to 32.3% from 30.7% in June, and the increase in non-food inflation sped up to 31.3% from 29.1%. 3.1% more expensive during the month.
S&P Global Ratings, which downgraded Ghana’s rating last week to CCC+, seven levels below investment grade, and changed the outlook from stable to negative, became the most recent rating agency to lower its assessment of the country’s capacity to service its debt.
Last month, the country turned to the International Monetary Fund for an economic program as a result of deteriorating economic conditions.
By 10:30 a.m. in the nation’s capital, Accra, the Ghanaian cedi had fallen 0.9% to a record low of 8.8869 per dollar, continuing its downward trend. Ghana’s 2032 dollar bond yield increased by 13 basis points to 20.6%.
