The Member of Parliament for Nsawam Adoagyiri, Frank Annoh-Dompreh, has expressed his hope that the prices of goods and services will follow the downward trend of fuel and transport costs.
The transport sector announced a 10 percent reduction in fares effective from Wednesday, May 17, in response to the fall in fuel prices. The Ghanaian Cedi has also been appreciating against the US Dollar.
According to the Bank of Ghana rate, as of Thursday, May 18, one Dollar was equivalent to 10.9475 Cedis, compared to about 12.5 Cedis previously.
The Majority Chief Whip took to Twitter to say: “Fuel prices are dropping, fares are dropping, prices of goods and services should drop same…let’s change the narrative. No complacency, let’s work, work, and work!”
However, the President of the Ghana Union of Traders Association (GUTA), Dr Joseph Obeng, has cautioned against expecting a quick drop in the prices of goods and services.
He said the market will adjust naturally when the conditions are favourable.
He attributed the recent strength of the Cedi to the positive expectations from the International Monetary Fund (IMF) bailout that Ghana received.
He explained that the economy is influenced by speculations, which can either boost or undermine confidence in the system.
Dr Joseph Obeng said: “It has not been stable for the last couple of weeks, it goes up a little, it comes down and then it will stabilize somewhere at 12.5 and now we see the sharp decline primarily due to the positive speculation.
“Our economy dwells on speculation…this particular time we are also denying the positive speculation around the IMF deal.”
He added that: “Now it will be too early. We do not plan price reduction, the price reduction is a natural sequence so when the exchange rates have gone down as we are expecting and it stabilizes for a longer period then you see that it trickles down on the prices, so it is not that when it goes up.”
“The market responds when it should respond,” he told Joy FM on Tuesday, May 16.