BoG Urges  Journalists  To Report  Financial Issues  Accurately

A call has been made to the journalists to report on the financial issues accurately to help to restore confidence and growth in the financial sector.

According to the First Deputy Governor, Bank of Ghana (BoG), Dr. Maxwell Opoku-Afari who made the foregoing call, accurate financial reportage was very paramount in business development.

This, he said would aid in calming financial market participants and prevent disorderly reactions during the current period of heightened uncertainty.

In a statement read on his behalf by the Director of Research of the Bank of Ghana, Mr. Philip Abradu- Otoo, he indicated that the start of 2022 which saw a global recovery process seemed to gain some traction from the covid-19 pandemic effects which were also supported by improved vaccinations coupled with what he termed opened economies, despite persisting supply chain constraints.

However, he noted that the gains were short-lived due to major upheavals in Eastern Europe.

He revealed that the ongoing conflict, which had come on the heels of the covid-19 pandemic has heightened uncertainty in the financial markets and triggered commodity price stocks.

" Based on these developments, the global outlook weakened somewhat, prompting the International Monetary Fund to downgrade global growth projections for 2022 and beyond to 3.6percent from the projected 4.4 percent in January 2022. 

These downgrades suggest challenging times ahead in the global economy, unless there's a resolution to the war in Ukraine, alongside possible lifting of sanctions against Russia by the West", it stated.

Additionally, he said the potential slowdown in economic activity, the global economy has witnessed a surge in inflation fuelled by rising food and energy prices, persistent supply chain bottlenecks, and rising demand pressures as economies reopened.

According to him, the current inflation has breached the set target in most countries.

"In the US, for example, CPI inflation surged to 8.5percent in March 2022, a 40-year high, from 2.6 percent in March 2021. 

Similarly, inflation in the Euro Zone reached 7.5 percent in March 2022. Ghana's inflation has also trended high and the March 2022 inflation rate of 19.4 percent is the highest since August 2009when inflation was reported at 19.6 percent", he noted.

He said elevated levels of inflation across advanced economies and emerging markets, as well as developing countries, have prompted the reversal of the covid-related accommodative policies that provided liquidity injections to the economy. Most Central banks, as a result, have commenced tightening of their policy stance", he revealed.

He said raising interest rates, especially in advanced economies, has led to believe tighter global financing conditions, leading to capital flow reversal and currency pressures in emerging and frontier economies including Ghana.

He revealed that the prevailing circumstances have prompted a strong and coordinated monetary and fiscal policy measures including a hike in the policy rate by 250 basis points to 17.5 percent, coupled with the government's announced 20 percent cut in expenditures as well as an additional 10 percent cut in discretionary spending to support the fiscal consolidation process.