By Kofi Ahovi
A survey conducted by the Bank of Ghana (BoG) in June this year indicates that businesses have confidence in the economy, but same cannot be said for consumers.
According to the Composite Index of Economic Activity (CIEA) survey, which gauges the sentiments of businesses and consumers, overall business confidence rose by 1.2 points in June 2010 while overall consumer confidence declined by 5.2 points.
The business sentiments were driven by their assessment of the performance of the economy, direction of interest rate, exchange rate stability, price trends and prospects for economic growth in 2010.
The deterioration in consumer sentiments reflected pessimistic assessment of changes in household finances, possibly due to the increase in utility tariffs that had been recently announced.
The survey shows an annual growth, in real terms, of 7.2% compared to 2.8% for the same period last year.
Factors that contributed to the growth of the index are exports, industrial consumption of electricity, sales by some key manufacturing concerns and consumer spending. Construction and Port & Harbour activity weighed down on the index.
Meanwhile in the Monetary Policy Committee (MPC) of the central bank report, it observed that early indications suggest that the pace of economic activity may have bottomed out but has began picking up, implying an early indication of the restoration of the growth process.
On the real sector of the economy, though real Gross Domestic Product (GDP) growth slowed down in 2009, it is expected that economic growth will move back to trend in the second half of this year.
Treasury rate instruments have fallen from 22.6% and 25.3% to 12.9% and 13.4% for the 91-day and 182-day Treasury bill rates respectively during the first half of the year. Also, the rates on the 1-year note and the 2-year fixed rate note fell from 20% and 23.5% to 13.8% and 13.9% respectively over the same period.
The 3-year fixed rate which was 19% in January 2010, declined to 15.7% in June 2010. Over the same period, the interbank overnight rate fell from 16.3% to 13.2%.
The stability of the Ghana Cedi continued in the first half of the year. On year-on-year terms the exchange rate of the cedi against the three main trading currencies; the US dollar, the pound sterling and the Euro; recorded respective appreciations of 3.3, 13.3 and 18.4%. This compares with depreciations of 29.8, 14.1 and 21.4% against the three currencies respectively in June 2009. In trade-weighted terms, the cedi, as at the end of June 2010, had appreciated cumulatively by 5.2% against the three currencies.
The foreign exchange market continued to gain in depth, with relative stability. Total foreign exchange transactions by banks and forex bureaux amounted to US$6.8 billion for the half year or 59.4% above the level recorded over the same period in 2009.
A survey conducted by the Bank of Ghana (BoG) in June this year indicates that businesses have confidence in the economy, but same cannot be said for consumers.
According to the Composite Index of Economic Activity (CIEA) survey, which gauges the sentiments of businesses and consumers, overall business confidence rose by 1.2 points in June 2010 while overall consumer confidence declined by 5.2 points.
The business sentiments were driven by their assessment of the performance of the economy, direction of interest rate, exchange rate stability, price trends and prospects for economic growth in 2010.
The deterioration in consumer sentiments reflected pessimistic assessment of changes in household finances, possibly due to the increase in utility tariffs that had been recently announced.
The survey shows an annual growth, in real terms, of 7.2% compared to 2.8% for the same period last year.
Factors that contributed to the growth of the index are exports, industrial consumption of electricity, sales by some key manufacturing concerns and consumer spending. Construction and Port & Harbour activity weighed down on the index.
Meanwhile in the Monetary Policy Committee (MPC) of the central bank report, it observed that early indications suggest that the pace of economic activity may have bottomed out but has began picking up, implying an early indication of the restoration of the growth process.
On the real sector of the economy, though real Gross Domestic Product (GDP) growth slowed down in 2009, it is expected that economic growth will move back to trend in the second half of this year.
Treasury rate instruments have fallen from 22.6% and 25.3% to 12.9% and 13.4% for the 91-day and 182-day Treasury bill rates respectively during the first half of the year. Also, the rates on the 1-year note and the 2-year fixed rate note fell from 20% and 23.5% to 13.8% and 13.9% respectively over the same period.
The 3-year fixed rate which was 19% in January 2010, declined to 15.7% in June 2010. Over the same period, the interbank overnight rate fell from 16.3% to 13.2%.
The stability of the Ghana Cedi continued in the first half of the year. On year-on-year terms the exchange rate of the cedi against the three main trading currencies; the US dollar, the pound sterling and the Euro; recorded respective appreciations of 3.3, 13.3 and 18.4%. This compares with depreciations of 29.8, 14.1 and 21.4% against the three currencies respectively in June 2009. In trade-weighted terms, the cedi, as at the end of June 2010, had appreciated cumulatively by 5.2% against the three currencies.
The foreign exchange market continued to gain in depth, with relative stability. Total foreign exchange transactions by banks and forex bureaux amounted to US$6.8 billion for the half year or 59.4% above the level recorded over the same period in 2009.
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