On July 1st 2007 the Bank of Ghana under President John Agyekum Kufuor introduced the Ghana Cedi, in replacement for the Cedi, the nation’s medium of exchange.
1st July, 2024, would be exactly seventeen years since the currency was the introduced.
The Daily Searchlight can however reveal that in just about seventeen years (there are a couple of months to spare), the Ghana Cedi has depreciated by a shocking 1,304%!
When the Ghana Cedi was introduced, its value was pegged at 0.92 Ghana Cedi to the dollar. It is currently trading at Ghana Cedi 12.92 to the United States Dollar.
The Daily Searchlight can reveal that using the universally accepted formula for calculating the appreciation or depreciation of a currency, the Ghana Cedi, in just seventeen years (there are still a few months to spare before the Cedi’s 17th birthday) has tumbled in value by a whopping 1,304%, with some decimals to spare.
The formula for calculating the appreciation or depreciation of a currency is this;
- Find Value 1 (V1);
- Find Value 2 (V2);
- Subtract V2 from V1 equals to V3.
- Divide V3 by V1 equals to V4.
- Multiply V4 by 100% = Rate of Appreciation or Depreciation of a Currency.
In the case of the Ghana Cedi, Value 1 (V1) was 0.92 GHC to the dollar (1st July, 2007).
Today’s Dollar to Ghana Cedi Exchange Rate is GHC12.92 (V2) (17th March, 2024).
Subtracting V1 from V2 (0.92 -12.92) is equal to 12.00.
Dividing 12 by 0.92 is equal to 13.04347.
Multiplying 13.0434 by 100% is equal to 1,304.347%
It means, effectively, that if your income has not been increased by the same percentage (1,304.347%) over the same period (17 years) , then you are the worse off.
(To be continued).
