The Ghanaian equity or stock market will maintain momentum in 2022, Axis Pension Trust has said.

According to a survey by the pension frim, 72% of participants are optimistic that the continuous rebound in economic activities will impact equity flows, particularly from pension funds.

Speaking at the Axis Pension Strategy Conference, Investment Strategist, Karl Ocran, explained that the valuation levels of the stocks on the Ghana Stock Exchange are cheap to cause an increase in liquidity.

“There was an interesting outcome on the equity market. Majority of participants believe that the equity market will maintain momentum in 2022 that is 72% of them believe that. What we think will drive the equity market is that valuation levels are cheap.”

“From the financial market perspective, if you look at where the market is trading, there are so many opportunities to earn some healthy returns as well as new guidelines that allow pension funds to allocate to the equity market which drives liquidity into that space,” he stated.

Presenting findings, Senior Lecturer at the Economics Department of the University of Ghana, Dr. Priscilla Twumasi Baffour, expressed worry about the high interest rates in Ghana compared with South Africa, Nigeria and Kenya.

In a research she conducted, Ghana performed below expectations in all the macroeconomic indicators. For instance, the country’s interest rate is currently on the rise, whilst its debt to total size of the economy is also a major concern.

Dr. Baffour also highlighted the Treasury bill rates, inflation, the performance of the local currency and the adverse credit ratings as some drivers of high interest rates in the country.

“Why are interest rates high? The question is, are they even high at all? Comparing Ghana to Kenya, Nigeria and South Africa, Ghana’s interest rate is way too high. We’re doing more than double of what is happening elsewhere. When we look at South Africa’s interest rate, it is pegged at 7.3%. Nigeria is also great but when you look for options for investment you will find that Nigeria is not doing great compared to Ghana” she said.

Meanwhile, Chief Investments Officer at Axis Pension Trust, Nana Wiafe Boamah has outlined some sectors trustees can maximise values for contributions.

“Most pension funds have invested about 90% of their assets in government or quasi government securities. If we feel that we really want to grow our economy and create the needed jobs, we must start allocating to the real sector. Tourism is an opportunity we can explore, there’s healthcare, real estate, agribusiness, among others.

Axis Pension Trust in partnership with the CFA Society-Ghana held the fourth edition of the Pension Strategy conference under the theme “Improving Member Outcomes through Scheme Design”.