The Role of Monetary Policy in Exchange Rate Determination in Ghana
Journal Title: Scholars Journal of Economics, Business and Management - Year 2015, Vol 2, Issue 10
Abstract
Abstract: Exchange rate behaviour is one topical issue that generates great controversy and debate among economists and policy analysts in Ghana. This study seeks to explore the long run relationship between narrow money supply (M2) and Ghana Cedi US Dollar exchange rate. Applying Engle-Granger co-integration technique on annual data spanning thirty two (32) years, the study has revealed that there is no systematic equilibrium relationship between the Cedi-Dollar exchange rate and narrow money supply of Ghana. In other words, the available data does not support the view that the depreciation of the Ghanaian currency is attributable to the rise in domestic money supply. It is suggested that the cause of the continuous fall in the international value of the Ghanaian Cedi is sought elsewhere. We also suggest that the persistent trade deficit over the years should be looked at closely as a plausible cause of the woes of the Ghanaian Cedi. Keywords: Co-integration, exchange rate, money supply, Ghanaian economy
Authors and Affiliations
Solomon Yemidi, François Mahama, John Odoyo Malala Tumaku, Dickson J. Fiagborlo
Keywords
Related Articles
- EP ID EP386927
- DOI -
- Views 82
- Downloads 0
Working Capital Management Practices and Financial Performance of Tea Processing Firms in Kenya
Abstract:The tea sector is the most important agricultural sub-sector in Kenya contributing about 26 percent of the total foreign exchange earnings. The sector has been listed by the government as one of the pillars of a...
Youth Unemployment Challenge as A Potential Source Of Insecurity In Nigeria
This paper on youth unemployment challenge as a potential source of insecurity in Nigeria is intended to highlight the problem at hand and also give possible policy alternatives that can alleviate it. The paper will also...
Impacts of Sovereign Credit Rating on European Stock Markets during European Debt Crisis
Sovereign credit rating not only affects the stock markets of rated countries, but also has spillover effects across countries and markets and in a highly integrated economic entity, spillover effects are more significan...
Transportation of Oil and Gas by Sea: Maritime Salvage, SCOPIC and the Vexed Issue of Environmental Salvage Regime
Abstract: Societies at all times loathe damage to the environment and in modern times have adopted a zero tolerance for environmental pollution. In doing this governments have adopted a pollution response and liability m...
Agricultural Development and Political Economy: A Review of the Nigerian Experience
It is no more a gain saying that ‘there cannot be any meaningful agricultural growth and development in any country without linking it to the roles and activities of the political rulers and leadership paddling the wheel...