Exchange Rate, Interest Rate and Inflation in Ghana: Is There a Missing Link?
Published: 25 July 2014
The debate ranges on, the controversy unresolved and the facts puzzling about the linkages among the three key macroeconomic indicators in Ghana – exchange rate, inflation rate and interest rates. The politicians and policy analysts alike have been at each other’s throat on this issue in recent times. The basic argument surrounding this controversy has been to explain the disparity among the indicators, particularly the seemingly de-link between exchange rate and inflation, inflation and interest rates etc. Various views from both policy and academic perspectives have emerged whether in support or against the ragging controversy. According to critics of the current state of affairs in the country, although the economy has been able to deal with inflation over the years, the resultant single-digit inflation rates are not consisted with other macroeconomic indicators especially the exchange rate and interest rates. One notable economist and politician who recently wage into the debate and stirred up the honest nest lay bear the following facts and debatable issues[i]: CLICK HERE TO DOWNLOAD FULL DOCUMENT
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