Ato Forson warns against ‘disastrous’ attempt by BoG to use net reserves to solve economic crisis

Ranking Member on the Finance Committee in Parliament, Dr Cassiel Ato Forson has issued a stern warning to the Bank of Ghana (BoG) to shelve any idea of using the country’s net reserves to solve the current hardships in the country.

This follows the increment of the Central Bank’s policy rate by 250 basis points to 17 percent, a situation some say will lead to the cost of loans going up with immediate effect which means the cost of living and cost of doing business will also go up, while consumer spending declines significantly.

The move forms part of measures by the governmnet to control the rising inflation which has led to skyrocketing prices in goods and services as well as the free-fall of the Ghanaian cedi against the US dollar.

But speaking on Accra-based Joy FM, the Ajumako-Enyan-Essiam MP said adopting that approach will be a “disaster staring in the face of the country,” which will lead to a cascading drop in the country’s currency.

“When the investors are to see that the reserves keep going down, then they would be rushing to exit and if they exit and the currency is going to drop and drop and drop until it falls. That is what I’m worried about,” Dr Forson said.

Source: thenewsroomonline.com