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The impact of COVID-19 on Ghana’s economy & stock exchange
Ghana’s Health Ministry says there are 24 confirmed coronavirus cases in the country with one death recorded. Ghana’s government in an effort to curtail the spread of the pandemic has closed most of its borders. Collins Appiah, Economic Advisor at Services Integrity Savings and Loans joins CNBC Africa to discuss the impact of the coronavirus on Ghana’s economy and the stock market.
Mon, 23 Mar 2020 14:19:33 GMT
Disclaimer: The following content is generated automatically by a GPT AI and may not be accurate. To verify the details, please watch the video
AI Generated Summary
- The stock market in Ghana has experienced a decline of around 3.4% due to COVID-19, exacerbating existing challenges in the banking sector.
- The Central Bank of Ghana has implemented measures to mitigate economic risks, including lowering the policy rate and reducing interest rates on loans.
- Currency trends in Ghana have shown the Cedi depreciating against the US dollar as COVID-19 cases have increased, prompting efforts to stabilize the currency.
Ghana's Health Ministry has confirmed 24 cases of coronavirus in the country, with one recorded death. The government has implemented various measures to slow down the spread of the virus, including closing borders and markets for sanitization. Despite these efforts, Ghanaians are starting to feel the impact on the economy and the stock market. Collins Appiah, an Economic Advisor at Services Integrity Savings and Loans, shared insights on how the virus has affected Ghana's economy and the financial sector during an interview on CNBC Africa.
Appiah discussed the impact of the virus on the stock market, noting that Ghana was already facing challenges in this area due to issues in the banking sector in 2019. The market was expected to recover in 2020, but the emergence of COVID-19 has further dampened investor confidence. As a result, the stock market has experienced a significant decline of around 3.4%. Appiah highlighted that trading activities have decreased, as investors are cautious amid global uncertainty.
Regarding the money markets, the Central Bank of Ghana recently held a Monetary Policy Committee (MPC) meeting where they announced measures to mitigate the economic risks posed by the pandemic. The policy rate was reduced from 15% to 14.5%, aimed at encouraging borrowing and stimulating economic activity. Additionally, financial institutions were directed to reduce interest rates on loans to support borrowers. The central bank also promoted financial inclusion by allowing free transfers between bank accounts and mobile wallets, which is expected to enhance accessibility to financial services.
Appiah addressed the currency trends in Ghana, noting that the Ghanaian Cedi initially remained strong against the US dollar. However, as COVID-19 cases increased in the country, the Cedi experienced depreciation. Measures are being taken to stabilize the currency, including utilizing reserves held by the central bank. The hope is that these actions will prevent further devaluation of the Cedi.
Overall, the evolving situation of the pandemic in Ghana is significantly impacting the economy, stock market, and currency valuation. The government and financial authorities are implementing measures to cushion the economy and support businesses and individuals during this challenging period.
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