News from the world of business.

The Bank of Ghana says it has adopted a cautious approach with the piloting of the digital currency – the e-Cedi, despite anticipation of the introduction of the electronic currency by a cross-section of Ghanaians. According to its Head of Innovation and Fintech, Kwame Oppong, the Central Bank is following the due process in piloting the digital currency and is therefore not taking any risk and chances at all.

News from the world of business.

Commercial debt largely from Eurobonds constituted the largest chunk of the country’s external debt as of the end of November 2021, data from the Bank of Ghana has revealed. The commercial debt of $16.01 billion, represented 42% of total external loans of $27.89 billion, and an increase of $3.38 billion over the previous year. It was followed by multilateral and bilateral loans of $8.08 billion and $3.79 billion respectively.

Government spent ¢33.61 billion on interest payments alone in 2021, the January 2022 Bank of Ghana Monetary Policy Report indicates.This was higher than the envisioned target of ¢32.5 billion.

The local currency has crossed the ¢7 to one dollar mark on the retail market with less than two months into 2022. Joy Business checks at some forex bureaus and commercial banks indicate that a dollar is being sold at a little above ¢7 cedis.

A new World Bank report has revealed that Ghana had accumulated significant government arrears prior to Covid-19 pandemic. This is far higher than the projected arrears post Covid-19. The report dubbed “Finance for an Equitable Recovery” indicates that the percentage of the country’s arrears was estimated at almost 5% of the country’s Gross Domestic Product.

As expected, the Monetary Policy Committee of the Bank of Ghana (BoG) has kept the policy rate at 14.5%. This is the first time the rate has been kept same since it was adjusted upwards by 100 basis points in November 2021.

The Ghana cedi has depreciated by 4.70% to the US dollar with only 45 days into the year, as pressure mounts on the local currency. This ranks it the second worst performing currency in Africa, among 15 top performing currencies. It is presently trading at ¢6.60 to one US dollar on the forex market.

Interest rates have started going up but marginally, as the challenges within the fiscal economy reflects on the monetary economy. According to the latest auctioning results of Treasury bills by the Bank of Ghana, interest rates of the short term financial instruments went by slightly.