First Deputy Governor of the Bank of Ghana Dr Maxwell Opoku-Afari has said contrary to fears that the economy will take some time before getting back on track, data available to the Central Bank suggests that the economy is on its way to recovery.

According to him, even though the country experienced a contraction in economic activities in the second quarter of this year, the Central Bank's Composite Index of Economic Activity (CIEA) shows significant recovery in the third quarter.

He said “what we have seen at the Central Bank and one of the advantages we have is to have access to what we call High Frequency Leading Indicators. Putting all those High Frequency Leading Indicators together, we have been able to put together what we call Composite Index of Economic Activity which helps us track short-term dynamics in economic activities and gives us a sense of where economic activity is going to.

“Even though we saw a contraction in the second quarter, the data that we are picking from the Composite Index Economic Activity and High Frequency data including credit to private sector, manufacturing, sales and a few other things shows that we are beginning to see some significant recovery already in the first few months of the third quarter up to September and in fact throughout the third quarter,” he noted.

Ghana’s economy as a result of the novel coronavirus pandemic contracted by 3.2 percent this year against the 5.7 percent growth rate recorded in the same period last year. The virus which led to a three-week lockdown of major parts of the country in March forced many businesses to close.

However, providing update on Ghana’s economy on Accra-based Mx24 TV, Dr Opoku-Afari expressed optimism that despite the contraction, the country’s economy is beginning to turn the corner.

“This recovery is quite significant to the extent that we think that growth will be positive in the third quarter. If you put it that way, then the leading indicators is pointing to what we will call a V-shaped recovery because of the significant negative impact we expected as a result of the lockdown as we expected the restrictions to be prolonged but we saw that there was a gradual lifting of those restrictions", he said.

"This meant that the impact on economic activities had not been as severe even though it is a contraction because -3.2% is not a small contraction but to have a turnaround in the third quarter shows that the recovery is going to be more of a V-shape than a U or a trapezoid,” he added.