An economist, Courage Martey says pegging the exchange rate will not be a sustainable solution to the continuous cedi depreciation.

This is in response to the Ghana Union of Traders Association's (GUTA) call for the exchange rate to be pegged in order to help make trading easier as their businesses suffer from the fast depreciating cedi.

Speaking in an interview on Joy FM's Top Story on Monday, Mr Martey said pegging of exchange rate will not help.

The Head of Insight at IC Security added that currently the country is experiencing some challenges because “we do not have a reserve to support a pegged exchange rate.”

“From my heart of heart I feel the pain of the business community but I am not sure that we want to damage the situation with solutions that may not be sustainable. If you peg the exchange rate, essentially while you may achieve some stability for businesses, what you are also doing is subsidising some needless imports and that will bring a run down on reserve which is already going down,” he said.

Meanwhile, the dollar has hit the ¢11 to $1 mark as some forex bureaus in parts of Accra are selling a dollar at an average of ¢11.2 on Saturday, October 8, 2022.

Checks by Joy Business indicate that the demand for the dollar keeps surging, as there is very little dollars in circulation.

Some forex bureau operators who spoke to Joy Business on condition of anonymity said the recent action by the Bank of Ghana has yielded little return.

According to them, there are no dollars in circulation.

Again, the last Forex Forward by the Bank of Ghana indicates that demand exceeded supply by $75.25 million in the latest auction.

This is compared with the $82.75 million recorded a month ago. This is despite the recent 750 million dollars injected into the system.

The development is impacting heavily on businesses, especially importers.

Commenting on the cedi depreciation, Mr. Martey stated that if nothing is done aggressively, it is impossible to catch up.

He suggested for the Bank of Ghana to engage in “swap and repose transactions with the International Central Bank, Yuan with the People's Bank of China and the USD with US First Bank to see how we can rake in some dollars for short term cover while we negotiate a deal with the IMF.”