The statement highlights a toxic mix: cedi depreciation amplifies import costs (food/oil), inflating debt burdens in local terms, risking default spirals—as in Ghana’s 2022 crisis where cedi fell 50%+, inflation hit 54%, and debt/GDP exceeded 100%.

Causes of falling cedi:

• Current Account Deficits: Chronic trade imbalances (imports > exports); oil price surges (2022 Russia-Ukraine war) widened gaps.
• Capital Flight: Investor outflows due to high debt, rating downgrades (Moody’s Ca in 2022); speculative attacks on managed float.
• Fiscal Imbalances: High PSBR monetization erodes confidence; pre-DDEP, government borrowing pressured reserves.
• External Shocks: Global rate hikes (US Fed) attract funds away; commodity volatility affects export earnings (cocoa/gold).
• Domestic Factors: Inflation differentials (PPP theory); weak productivity, corruption perceptions.
• Speculation and Black Market: Parallel rates widen premia, as in 2022’s 20%+ gap.

Measures by authorities (BoG/Government):

• Forex Interventions: BoG sold $450m+ in auctions (2022-2023) to supply dollars, per forex regulations.
• Monetary Tightening: Raised MPR to 29% (2023-2025) to curb inflation and attract inflows.
• IMF Support: $3bn ECF (2023) for reserves buildup and reforms.
• Gold Purchase Program: Mandated miners sell 20% gold to BoG (2023), boosting reserves to $7bn+ by 2025.
• Fiscal Reforms: DDEP restructured domestic debt; expenditure cuts, revenue measures (e.g., E-Levy).
• Export Incentives: Accelerated AfCFTA implementation for diversification.
• Capital Controls: Temporary limits on forex outflows, compliant with IMF.
• Digital Initiatives: CBDC (e-Cedi pilot) to enhance efficiency, reduce dollarization.

These stabilized the cedi (appreciating slightly in 2024), but sustainability requires structural fixes like industrialization for long-term resilience.