The Ghanaian Cedi edged higher to 5.7750 to the dollar this week from 5.7825 on the back of positive growth momentum, AZA, Africa’s largest non-bank currency broker by trading volume reported.
The IMF earlier this month revised Ghana’s growth outlook to 4.6% from its previous estimate of 4.2%.
However, the Cedi’s upward trajectory could be tempered in the coming weeks as the government introduces four new taxes at the start of May: a Covid-19 health levy to support pandemic-related expenses; a sanitation and pollution levy to improve the quality of sanitation management; an energy sector recovery levy to finance excess capacity charges; and a financial sector clean-up levy to help the government meet its commitments to return cash to depositors and investors that had been affected by the closure of a number of local banks.
Critics including energy consultant Dr. Sulemana Yussif say the new taxes risk stifling the economy. If the introduction of the taxes has a negative impact, the currency could slide towards 5.8500.
