Speaking on the Citi Breakfast Show on Wednesday, May 15, Joe Jackson told host, Bernard Avle, that the government must not run a budget deficit, which he said will spell doom for the already struggling Cedi and Ghanaian economy.

“What the government needs to do at this moment is to be fiscally disciplined and spend within its budget. The government must cut down on its spending. Make sure that you don’t spend more than you promised in this election year.

“Remember, people like Bloomberg and others do not see that this government can spend within its budget,” Joe Jackson added.

He, however, blamed the current free fall of the Cedi against major trading currencies on the unplanned injection of Dollars into the economy when Ghana was kicked out of the international market.

“It [The Cedi depreciation] is the lapse effect after we fell out of the international market. If we had not pumped that much money into the economy, we would not be facing this situation. The major reason is that when we pumped in deficit financing, this is the effect we are now experiencing.”

The year-to-date loss on the Cedi currently stands at about 14 percent.

Currently, a dollar is selling at GH¢14.90 on the forex market, which is significantly up from the GH¢10.97 it was sold for the same period in May 2023.

Bloomberg reports that the Cedi’s depreciation is being exacerbated by a decline in cocoa earnings as exports fell by about $500 million in January and February 2024 due to poor weather conditions and the swollen shoot disease.

The Bloomberg report added that the current depreciation depicts the Cedi’s record-breaking weakening cycle that has left analysts to forecast worse times for the currency over elevated risks of election-year funding and stalled debt deals.

Fitch, however, forecasts that the Cedi will end 2024 at GH¢12.25 to a dollar.