World’s Worst Performing Currency, the Cedi, Reverses Gains — Economist Steve Hanke Says Ghana Inflation Now Over 140%

Just days aft registering marginal gains against the U.S. dollar, the Ghanaian currency — the cedi — slipped to C14:$1 versus the U.S. dollar connected the overseas speech parallel marketplace connected Nov. 7. The cedi’s reversal is said to person dented the currency’s betterment prospects. On the different hand, Ghana’s erstwhile president John Mahama and economist Steve Hanke person suggested that the country’s ostentation complaint is overmuch higher than the 37.2% which was recorded successful September.

Cedi’s Interbank Exchange Rate Unchanged

Just days aft it marginally recovered from an all-time low, the Ghanaian currency’s speech complaint versus the U.S. dollar slipped beyond the 14:1 people connected Nov. 7, a study has said. According to the report, the cedi’s autumn from C13.95 to C14.20 per dollar connected the forex parallel marketplace suggested that the currency’s much-talked-about betterment versus the greenback is improbable to hap immoderate clip soon.

Bank of Ghana Exchange Rates pic.twitter.com/oognH3AM42

— Bank of Ghana (@thebankofghana) November 4, 2022

Despite its latest autumn versus large planetary currencies connected the parallel market, the Bank of Ghana (BOG)’s Nov. 8 speech complaint information showed the cedi was trading astatine conscionable supra 13 units for each dollar. In fact, since the BOG’s Oct. 27 update, the cedi’s interbank speech complaint versus the dollar has remained mostly unchanged.

Ghana’s Real Inflation Rate

After starting the twelvemonth trading supra 6:1, the cedi, according to the BOG, “has depreciated by 37.5 per cent, 24.1 per cent, and 27.5 per cent against the US dollar, the pound, and Euro, respectively.” The BOG blames higher crude lipid prices, the “non-roll implicit of maturing bonds by non-resident investors,” arsenic good arsenic argumentation reversals, for the cedi’s woes.

The cedi depreciation has, successful turn, seen the country’s authoritative ostentation complaint surge past 37% successful September. Despite this being the country’s highest ostentation complaint successful 2 decades, President Nana Akufo-Addo was precocious quoted claiming that Ghana’s complaint is inactive amended than that of Togo and Senegal.

However, erstwhile Ghanaian president John Mahama and Steve Hanke, a prof of applied economics astatine Johns Hopkins University, person formed doubts implicit the genuineness of Ghana’s authoritative ostentation complaint figures. While Mahama suggested that Ghana’s nutrient ostentation is astir 122%, Hanke placed Ghana’s ostentation complaint astatine 142%, the world’s third-highest rate.

According to the economics professor’s latest ostentation dashboard, the lone countries whose ostentation rates surpass that of Ghana are Zimbabwe (417%) and Cuba (151%).

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