Prof. Bokpin believes stabilizing the cedi at GH₵10–12 is the right approach

Economist and Finance Professor Godfred Bokpin from the University of Ghana has shared his views on the cedi's value. He believes stabilising the cedi between GH₵10 and GH₵12 is essential for Ghana’s economy. He stressed that predictability is more important than sudden fluctuations.

During a discussion on Joy FM’s Super Morning Show, Prof. Bokpin noted that the Central Bank aimed to manage the exchange rate. However, this was not communicated to the public initially. “I indicated earlier that the central bank was targeting the exchange rate,” he explained.

He added that the recent appreciation of the cedi was not solely due to market forces. It also resulted from direct interventions by authorities. “What we witnessed in strengthening the local currency wasn’t just demand and supply,” he said.

Prof. Bokpin argued that this rapid appreciation made it hard for businesses to adjust. “The rate of facilitation was too aggressive for planning,” he stated. This situation created disruption rather than stability, making it difficult for people to adapt.

He mentioned that some stakeholders expected the cedi to settle around GH₵10 soon. For him, achieving genuine and lasting stability is crucial moving forward. “We need clarity on stabilising beyond aggressive strengthening,” he said.

Prof. Bokpin clarified that economic stability does not mean a fixed exchange rate. Instead, it involves predictable and moderate variations in rates over time. “There will be some variation, but it shouldn’t cause disruptions or uncertainty,” he noted.

He cautioned against celebrating the cedi’s recent gains too quickly. These changes come with trade-offs for both private sector players and government entities.