Another re-denomination of the Cedi imminent–IEA’s Kwakye.

Dr. John Kwakye, Director of Research at the Institute of Economic Affairs (IEA).

The Director of Research at the Institute of Economic Affairs (IEA), Dr. John Kwakye, has predicted that the growing rate of inflation and the devaluation of the Cedi versus the Dollar would soon lead to a new re-denomination of the currency of Ghana.

He made this known via his twitter handle monitored by GhanaNews.hrforum.uk. He added that, Ghanaians should prepare for another re-denomination unless the government and central bank take action to tackle inflation and currency devaluation.

Inflation hit a record high of 33.9% in August. Compare this to July's result of 31.7 percent and you'll see a rise of 2.2 percent.

Dr Kwakye tweeted “Phasing out 1- and 2-cedi notes from the economy as planned by BoG, will not only put pressure on the 5-cedi notes, but will also further fuel inflation.

“If we don’t rein in inflation and depreciation, it won’t be too long before we undertake another redenomination.”

In July 2007, the Cedi was redenominated to the Ghana Cedi (GH¢), making 10,000 Cedis equal to GH¢1.

The Central Bank said that difficulties with accounting and statistical record-keeping, as well as issues with data-processing software, were major factors in the decision to re-denominate the currency.

However, the re-denomination did not affect the intrinsic value of the currency, which was to have the value of the cedi reflect that of its predecessor but this time in smaller portions. The idea was popularly echoed during the period as, “the value will be the same” or the “value is the same”.

A copy of his tweet below:

Phasing out 1 and 2 cedi notes from the economy as planned by BoG, will not only put pressure on the 5 cedi notes, but will also further fuel inflation. If we don't rein in inflation and depreciation, it won't be too long before we undertake another redenomination.

— J. K. Kwakye (@JohnKwabenaKwa1) September 23, 2022

Source: ghananews.hrforum.uk