The 5 questions of Ato Forson in Bawumia

General News of Wednesday, March 20, 2019

Source: Myjoyonline.com

2019-03-20

Casiel Ato Forson, a minority finance critic, is the latest to task Vice President Mahamudu Bawumia with answering questions about the economy.

Before his unfortunate demise, former Veep Paa Kwesi Amissah Arthur had asked his successor to answer the questions he had asked him in the performance of his duties.

He wanted the former deputy governor of the Bank of Ghana (BoG) to admit that the country's economy is in trouble, despite efforts to reorganize it.

He said that the economy under the ruling party, the New Patriotic Party (NPP), has not been better than under the previous government.

With the Cedi struggling to find its bearings and what the minority describes as an economy capable of doing better, Mr. Forson has five questions that the Veep can answer.

Below are the questions that the Minority Finance Spokesperson wants answered.

Question 1: Why would an independent central bank, focused on price stability, decide to lower the monetary policy rate on the basis of its own research findings that the normalization of US policy was strengthening the US dollar and compelling investors to withdraw Emerging-market funds, and as prices rise petroleum products are likely to affect the prices of transport and utilities?

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

Question 3: Why would an independent central bank, focused on price stability, decide to lower the key rate in favor of growth, which should be higher than the previous year, while the local currency is under pressure?

Question 4: Why would an independent central bank, focused on price stability, have decided to lower the policy rate in the face of excess liquidity in the banking sector from banks increasing their minimum paid-up capital by more than 100%, then that the local currency was fast? depreciate?

Question 5: Clearly, an economy can not be externally unstable and internally stable. How can a rapid depreciation of the exchange rate be accompanied by a single-digit inflation rate, as indicated by published macroeconomic indicators?