Ghana’s Minority Spokesperson on Finance, Ato Forson’s has 5 questions for the Vice President on the economy

The Minority Spokesperson on Finance, Casiel Ato Forson has sent 5 questions on the economy to the Vice President, Dr Mahamudu Bawumia. 

Vice President Dr. Mahamudu Bawumia

This is not the first time a member of the opposition is asking Dr Bawumia to answer questions on the economy.

Before his demise, the former Vice President Paa Kwesi Amissah Arthur asked his successor, to answer the questions he posed to him while in office. 

He argued that he wanted the Dr Bawumia to concede that the country’s economy is struggling, despite efforts to revamp it.

According to Mr Forson, the government must do better in arresting the depreciating cedi.

He, therefore, has 5 questions for Dr Bawumia to answer.

Below are the questions the Minority spokesperson on Finance seeks answers to. 

Question 1: Why would an independent central bank with focus on price stability decide to reduce the monetary policy rate against its own research findings that US policy normalization is strengthening the US dollar and causing investors to move funds away from emerging economies and that upward adjustment in domestic prices of petroleum products are likely to affect transport and utility prices?

Question 2: Why would an independent central bank, with a focus on price stability, decide to lower the policy rate in the face of dwindling net international reserves and a rising interest rate abroad?

Question 3: Why would an independent central bank with a focus on price stability decide to reduce the monetary policy rate in favour of growth, which has been projected to be higher than the previous year’s, while the local currency is under pressure?

Question 4: Why would an independent central bank with a focus on price stability decide to lower the policy rate in the face of excess liquidity in the banking sector emanating from banks increasing their minimum paid-up capital by over 100 percent, while the local currency is fast depreciating?

Question 5: Clearly, an economy cannot be externally unstable and internally stable. How can a rapid exchange rate depreciation be accompanied by a single digit inflation rate as captured by the posted macroeconomic indicators?

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