US-based Associate Professor of Finance at Andrews University in Michigan, Williams Peprah, is predicting a mixed development for the country as a result of the increase in the US interest rate to 3.75%.
The Federal Reserve yesterday increased the benchmark rate to its highest in 14 years.
The bank hopes pushing up borrowing costs will cool the economy and bring down price inflation.
According to Professor Peprah, the increase in interest rate would make investing in the US economy better than Ghana, leading to capital flight and a stronger dollar.
“An increase in the interest rate by US Federal Reserve by 0.75% to 3.75% will impact Ghana’s economy both negatively and positively. The negative side is that it will lead to capital flight and a reduction in foreign direct investments into the country and the dollar will become stronger; and you may see the cedi devaluing more or faster”.
“Should Ghana be able to attract investors into the country, you may have to be able to compensate or give higher returns of more than 3.75% [dollar rate] to investors.
Dr. Peprah further stated that the goods and services from the USA to Ghana will also become expensive as their cost of credit will become expensive.
However, he believes an increase in Ghanaian exports will positively impact the economy.
“The positive side is that it will make Ghana’s exports cheaper”.
Latest Stories
-
A/R: Man nabbed for alleged impersonation of herbalist and defrauding
9 minutes -
From Survivor to Icon: Jamie Foxx owns the night at the BET Awards
23 minutes -
Legend of The Week – Teddy Osei
26 minutes -
Gov’t announces major data bundle increases across all networks from July 1
38 minutes -
OSP carries out searches at SML offices in ongoing suspected corruption probe
48 minutes -
Jobe Bellingham joins Dortmund for initial £27m
51 minutes -
Two suspects arrested in Elmina for smuggling 250 bags of cocoa beans
1 hour -
Abuakwa South MP launches 4th edition of BECE support programme
1 hour -
Lives of Staff and students of GLISS threatened by ECOMOG slum dwellers over impending demolition
2 hours -
Ouattara slams Hearts fans over lack of support, urges loyalty to local clubs
2 hours -
Minority slams government over poor handling of nurses’ strike
2 hours -
EGL launches “Cedi Apicki Apicki” Promo to cushion consumers amid cedi appreciation
2 hours -
Photos: Interesting images for funeral of late Mamponghene Daasebre Osei Bonsu II
2 hours -
Bibiani GoldStars CEO confirms Frimpong Manso will stay after historic title win
2 hours -
Ghana Internet Governance Forum 2025 promotes inclusive digital future
2 hours