Contact Us

For Marketing, Sales and Subscriptions Inquiries
2637 E Atlantic Blvd #43110
Pompano Beach, FL 33062

Conference List

The Economics and Finance Letters

June 2020, Volume 7, 1, pp 1-12

An Agnostic Analysis of Exchange Rate Movement in Ghana

Shuffield Seyram Asafo


Adelajda Matuka

Shuffield Seyram Asafo 1 Adelajda Matuka 1 ,

  1. PhD Student, University of Macerata, Department of Economics and Law, Macerata, Italy. 1

Pages: 1-12

DOI: 10.18488/journal.29.2020.71.1.12

Share :

Article History:

Received: 02 October, 2019
Revised: 05 November, 2019
Accepted: 12 December, 2019
Published: 09 January, 2020


Based on quarterly data for the period 2006:3-2018:4, the effect of exchange movement on a set of price indices in Ghana is examined via a Bayesian Vector Autoregressive model. Using normal inverted-Wishart priors, the posterior estimates are generated by Markov Chain Monte Carlo draws via a sign restriction algorithm. Findings showed that the response of consumer prices (CPI), producer prices (PPI) and non-food prices (NFP) to exchange rate shocks is low and incomplete. Furthermore, the forecast error variance decomposition (FEVD) indicated that CPI is most responsive to exchange rate impulses than NFP and PPI. In addition, inflationary pressures in Ghana emanated from exchange rate sources other than monetary sources. The paper recommends “pricing in local currency” as a deliberate policy to insulate domestic prices from volatilities in the exchange rate.
Contribution/ Originality
This study used a new estimation methodology to examine the effect of exchange rate dynamics on prices in Ghana.


Bayesian analysis, Inflation, Financial markets and macroeconomy, Money supply exchange rate, Ghana.



Adamu, I.M. and R. Rasiah, 2016. External debt and growth dynamics in Nigeria. African Development Review, 28(3): 291-303.Available at:

Adeniran, A.O., M.I. Azeez and J. Aremu, 2016. External debt and economic growth in Nigeria: A vector auto-regression (VAR) approach. International Journal of Management and Commerce Innovations, 4(1): 706-714.

Adesola, W.A., 2009. Debt servicing and economic growth in Nigeria: An empirical investigation. Global Journal of Social Sciences 8(2): 1-11.Available at:

Akram, N., 2017. Role of public debt in economic growtrh of Sri Lanka: An ARDL approach. Pakistan Journal of Applied Economics, 27(2): 189-212.

Ali, R. and U. Mustafa, 2012. External debt accumulation and its impact on economic growth in Pakistan. Pakistan Development Review, 51(4): 79-97.Available at:

Banerjee, A., J. Dolado and R. Mestre, 1998. Error-correction mechanism tests for cointegration in a single-equation framework. Journal of Time Series Analysis, 19(3): 267-283.Available at:

Brown, R.L., J. Durbin and J.M. Evans, 1975. Techniques for testing the constancy of regression relationships over time. Journal of the Royal Statistical Society: Series B (Methodological), 37(2): 149-163.

Campbell, K.A., 2009. The economic role of government: Focus on stability, not spending. Washington, DC: Heritage Foundation.

Casares, E.R., 2015. A relationship between external public debt and economic growth. Estudios Económicos (México, DF), 30(2): 219-243.

Chowdhury, A.R., 2001. External debt and growth in developing countries: A sensitivity and causal analysis. Discussion Paper No. 95. World Institute for Development Economics Research (WIDER), United Nations University, Helsinki.

Debt Management Office Publications, 2006. Annual report and statement of account. Available from

Elbadawi, I.A., B.J. Ndulu and N. Ndung’u, 1997. Debt overhang and economic growth in Sub-Saharan Africa. In: Iqbal, Z., Kanbur, R., editors. External Finance for Low-income Countries. Washington, DC: International Monetary Fund.

Jebran, K., A. Ali, U. Hayat and A. Iqbal, 2016. Public debt and economic growth: A reassessment. Pakistan Business Review, 18(2): 307-324.

Johansen, S., 1988. Statistical analysis of cointegration vectors. Journal of Economic Dynamics and Control, 12(2-3): 231-254.Available at:

Johansen, S. and K. Juselius, 1990. Maximum likelihood estimation and inference on cointegration—with applications to the demand for money. Oxford Bulletin of Economics and Statistics, 52(2): 169-210.Available at:

Kharusi, S.A. and M.S. Ada, 2018. External debt and economic growth: The case of emerging economy. Journal of Economic Integration, 33(1): 1141-1157.Available at:

Krugman, P., 1988. Financing vs. Forgiving a debt overhang. Journal of Development Economics, 29(3): 253-268.Available at:

Mohamed, B.M., 2013. Assessing the short-and long-run real effects of public external debt: The case of Tunisia. African Development Review, 25(4): 587-606.Available at:

Momodu, A., 2012. Effect of debt servicing on economic growth in Nigeria. Reiko Journals of Business and Finance, 4(3): 116-124.

Ogunyemi, A.O., 2011. Rethinking the origin of Nigeria's debt burden: A historical reconstruction. Journal of the Historical Society of Nigeria, 20(2011): 26-44.

Pesaran, H.M. and Y. Shin, 1999. Autoregressive distributed lag modelling approach to Cointegration analysis. In: S. Storm (Ed.), Econometrics and Economic Theory in the 20th Century: The Ragnar Frisch Centennial Symposium, chapter 11. Cambridge: Cambridge University Press.

Pesaran, M.H., Y. Shin and R.J. Smith, 2001. Bounds testing approaches to the analysis of level relationships. Journal of Applied Econometrics, 16(3): 289-326.Available at:

Ploberger, W. and W. Kramer, 1992. The CUSUM test with OLS residuals. Econometrica, 60(2): 271-285.Available at:

Sachs, J., 1988. The debt overhang of developing countries. In: Calvo, A.G., Findlay, R., Kouri, P., de Macedo, J., editors. Debt, Stabilization and Development: Essays in Memory of Carlos Diaz Alejandro. Oxford: Basil Blackwell. pp: 80-102.

Udeh, S.N., J.I. Ugwu and I.O. Onwuka, 2016. External debt and economic growth: The Nigeria experience. European Journal of Accounting Auditing and Finance Research, 4(2): 33-48.

World Bank, 2004. World development indicators 2004 (English). Washington, DC: World Bank. Available from


Google Scholor ideas Microsoft Academic Search bing Google Scholor


This study received no specific financial support.

Competing Interests:

The authors declare that they have no competing interests.


Special gratitude goes to fellow researchers who made their input in diverse ways to make this paper a success. All other errors remained the author’s responsibility.

Related Article

( 1 ) An Agnostic Analysis of Exchange Rate Movement in Ghana
( 2 ) New Evidence on the Link Between Income Inequality and Misery Index: A Nonlinear Time Series Analysis
( 3 ) Geographical Starting Points the Analysis of Current Rural Problems in Montenegro: Case Study of Rural Local Community Kralje
( 4 ) Institutionalising and Mainstreaming Policy Analysis Culture in African Environments
( 5 ) Profit And Loss Sharing As an Offshoot for Bank Stability: A Comparative Analysis
( 6 ) The Effect of Selected Financial Ratios on Profitability: An Empirical Analysis of Listed Firms of Cement Sector in Saudi Arabia
( 7 ) Benefit-Cost Analysis of Alternative Insect Pests Management in Cashew and Mango Orchards in Tanzania
( 8 ) Comparative Analysis of Technical Efficiency of Milk Production Systems in Uasin Gishu County of Kenya
( 9 ) An Analysis of Purchase Behavior of Generation Y in Kenya
( 10 ) Dynamic Analysis of Competitive Technology Innovation Diffusion Model
( 11 ) Causal Relationship between Imports and Economic Growth in Zimbabwe: An Empirical Analysis 1975 – 2013
( 12 ) Measuring Efficiency in Banks: A Brief Survey on Non – Parametric Technique (Data Envelopment Analysis)
( 13 ) A Theoretical Analysis Upon the Environmental Health and Justice Issue: A Case Study for a Comparison Between G20s Unitary and Federal Members
( 14 ) Decoupling Analysis of Bulgaria’s Agriculture
( 15 ) A Factor Analysis Approach Towards a Study of the Factors Affecting Students’ Choice of Higher Education Institution: A Case Study of a Private Institution (Twintech International University College of Technology)
( 16 ) Panel Data Analysis of the Impact of Economic Freedom as Well as Economic Conditions, The Quality of Life, and Public Education Spending on U.S. Undocumented Immigrant Settlement Patterns
( 17 ) Dynamics of Inflation, Economic Growth, Money Supply and Exchange Rate in India: Evidence from Multivariate Analysis
( 18 ) Purchasing Power Parity Hold in Major SAARC Countries? Panel Cointegration Analysis
( 19 ) Specifying Quality of Governance in Transition Economies with Cluster Analysis
( 20 ) Effect of Budget Defict on Private Investment in East African Community for the Period 1981-2015: A Panel Data Analysis
( 21 ) Comparative Analysis of the Effectiveness of Coub-Douglas, Real Business Cycle, and Keynsian Growth Models in Determining Economic Growth in Nigeria
( 22 ) China Pakistan Economic Corridor (CPEC): Analysis of Internal and External Challenges
( 23 ) The Effects of Exchange Rate Variability on Trade Flows in Nigeria: A Cointegration Analysis
( 24 ) Social Protection Programmes, Agricultural Production and Youth Employment in Nigeria: Analysis from LSMS-ISA
( 25 ) Scenario Economic Impact Analysis of Offshore Fishing Tournaments in Ocean City
( 26 ) An Analysis of Chinas Poverty Research Based on CiteSpace
( 27 ) Dutch Disease: Myth or Reality? An Analysis of the ARDL Model
( 28 ) Analysis of the Effects of Pull and Push Factors on Brain Drain: An Example of Turkey
( 29 ) Analysis of Environmental Factors Affecting Manufacturing Small and Medium-Size Enterprises in Kogi State Nigeria
( 30 ) Estimating the Economic Determinants of Technical Efficiency of Bioenergy in EU-28: An Application of Tobit Analysis
( 31 ) Problems of Bilateral Trade Deficit between Bangladesh and India: A 2SLS Regression Analysis
( 32 ) Analysis of Effect of Profitability, Capital, Risk Financing, the Sharia Supervisory Board and Capabilities Zakat in Islamic Perspective with Circular Approach Causastion on Islamic Banks in Indonesia
( 33 ) Incidence of Short Term Private Capital Outflow: Empirical Analysis in Nigeria
( 34 ) The Trajectory and Diaspora of Women Imprisonment: An Analysis
( 35 ) German Exports, Economic Growth and Foreign Demand: An Analysis of the Period 2000–2017
( 36 ) Multivariate Analysis in Formulation of the Benefit-Cost Index Related to the Sugarcane Production System in the Quirinopolis Municipality Productive Center, Goias, Brazil
( 37 ) Determinant Analysis of Productivity on Rice Management in Indonesia
( 39 ) Analysis of Traffic Accident Occurrence at Hazardous Road Locations: A Case Study in Tunisia
( 40 ) Analysis of Causal Nexus between Defense Spending and Economic Growth in Nigeria: A Toda-Yamamoto Approach
( 41 ) Determinant of Tax Revenue Effort in Sub-Saharan African Countries: A Stochastic Frontier Analysis
( 42 ) Analysis of Credit Ratings Determinants: Evidences in Brazilian and American States
( 43 ) Export- Led Growth Hypothesis for Ghana: A TVAR & TVECM Analysis
( 44 ) The Dimensions of the Quality Perceived by Users in a Clinical Analysis Laboratory of A University Hospital
( 45 ) An Empirical Analysis of the Impact of Decentralization on Poverty in Cameroon
( 46 ) Human Capital and Economic Growth in Latin America: A Cointegration and Causality Analysis
( 47 ) Exploring the Dimensions Using Exploratory Factor Analysis of Disruptive Factors and Inventory Control
( 48 ) A Qualitative Analysis of the Impediments to Business Innovation and Information Management in Nigeria: A Policy Stance
( 49 ) Analysis of Demographic Factors on Perceptions of Inventory Managers towards Healthcare Performance
( 50 ) Contribution of Ready-Made Garments Industry on the Economic Development of Bangladesh: An Empirical Analysis
( 51 ) The Financial Decentralization Policy for Local Development in Cameroon: An Econometric Analysis
( 52 ) Cross-Time-Frequency Analysis of Volatility Interdependence among Stock and Currency Markets
( 53 ) Financial Development and Economic Growth in Nigeria: New Evidence from a Threshold Autoregressive and Asymmetric Analysis
( 54 ) Analysis of Synergies in Indian Corporate M&A Deals: A Logit Regression Approach
( 55 ) Economic and Noneconomic Forces on Remittance Receiving: A Panel Analysis of Top Remittance Sending Countries towards Bangladesh
( 56 ) Testing the Random Walks in Korea Stock Exchange
( 57 ) The Effects of Exchange Rate Liberalization in Kenya on French Beans Exports
( 58 ) Exchange Rate Movements, Import And Economic Growth in Nigeria (1986-2010)
( 59 ) Impact of Food Beverage Price Index and Exchange Rate Volatility on Economic Growth
( 60 ) Testing the Random Walk: The Case of Hong Kong Stock Exchange
( 61 ) Role of Foreign Investment and External Debt in Determination of Exchange Rate
( 62 ) The Impact of the Global Financial Crisis on the Debt, Liquidity, Growth, and Volume of Companies in Palestine Stock Exchange
( 63 ) Studying the Integration of Damascus Securities Exchange with Selected Stock Markets
( 64 ) The Effect of Exchange Rate Changes on Consumer Prices in Nigeria: Evidence from VECM Model
( 66 ) Implications of Crude Oil Price Volatility and Parallel Exchange Rate Fluctuation on the Cost of Living in Nigeria
( 67 ) Relevance of Stakeholders Theory, Organizational Identity Theory and Social Exchange Theory to Corporate Social Responsibility and Employees Performance in the Commercial Banks in Nigeria
( 69 ) The Profitability of Momentum Strategies: Empirical Evidence from Damascus Securities Exchange (DSE)
( 70 ) Exchange Rate and Foreign Reserves Interface: Empirical Evidence from Nigeria
( 71 ) Impact of Exchange Rate Fluctuation on Selected Economic Sectors of the Nigerian Economy
( 72 ) The Colonialists & Indigenous Exchange Currency: Tracing the Genesis of Socioeconomic Woes in Postcolonial Nigeria
( 73 ) The Transitional Relationship between Economic Growth and Exchange Rate in Ghana: An Empirical Approach
( 74 ) Determinants of Exchange Rate in Nigeria: A Comparison of the Official and Parallel Market Rates
( 75 ) Exchange Rate Pass-through to Prices: VAR Evidence for Albania
( 76 ) Issues of Unemployment in Nigeria: Effect of Real Exchange Rate and Inflation Interaction
( 77 ) Exchange Rate Volatility, Foreign Exchange Market Intervention and Asymmetric Preferences
( 79 ) An Empirical Investigation of Real Exchange Rate Responses to Foreign Currency Inflows: Revisiting the Dutch Disease Phenomenon in South Asia
( 80 ) Factors Affecting the Individual Stock Price Index (IHSI) Industrial Manufacturing Sector in Indonesia, Automotive Sub Sectors, and Components in Indonesia Stock Exchange (IDX)
( 81 ) Management of The CFA Franc: What are the Fundamentals of the Real Exchange Rate in West African Economic and Monetary Union (WAEMU)?
( 82 ) Determinants of Profitability and its Implications on Corporate Values (Studies at Ceramic, Porcelain and Glass Sub Sector Listed in Indonesia Stock Exchange, 2009 - 2018)
( 83 ) Exchange Rate Volatility and Agricultural Commodity Prices i Nigeria (2000-2018)
( 84 ) The Impact of Data Frequency on the Level of Exchange Rate Pass-through to Consumer Prices in Nigeria
( 85 ) Financial Risks in Turkish Banking Industry: A Panel Data Analaysis on Istanbul Stock Exchange
( 86 ) Exchange Rate Fluctuations and the Performance of Nairobi Securities Exchange Market in Kenya During the Coronavirus Pandemic
( 87 ) A Study on Financial Performance of Transport & Warehouses Firms Listed on the Hanoi Stock Exchange
( 88 ) Nexus among Foreign Exchange Reserve, Remittance and Trade Openness: An Empirical Investigation in the Case of Bangladeshi Economy
( 89 ) Testing the Validity of Arbitrage Pricing Theory: A Study on Dhaka Stock Exchange Bangladesh
( 90 ) An Analyses of Exchange Rate Volatility: A Case of Sane Countries
( 91 ) Importance of Corporate Governance Quality and Voluntary Disclosures of Corporate Governance Information in Listed Malaysian Family Controlled Businesses
( 92 ) Strategic Evaluation of Distributed Power Generation Technology: A Sustainable Approach
( 96 ) Rate of Return Would Not Increase To the Extent of Annuity Saving Discount
( 97 ) The Association Between Corporate Risk Disclosure and Firm Performance in Emerging Country – The Case of Egypt
( 98 ) A Model of Strategic Thinking: Islamic and Iranian Perspective
( 99 ) Promoting Local Acceptability of International Oil Companies (IOCS) Through Corporate Social Responsibility (CSR): The Case of Tullow Oil in Ghana
( 100 ) Challenges and Survival Strategies for Women in Small Scale Catering Business: A Case Study of Siyaso Magaba, Mbare
( 101 ) Attributes Influencing Strategic Alignment in the Service Sector: An Indonesian Banking Sector Case Study
( 103 ) The Role of Strategic Planning on the Management of Organizational Change
( 104 ) Development, Preference Change, and Inequality in an Integrated Walrasian-General-Equilibrium and Neoclassical-Growth Theory
( 105 ) Managerial Judgement Versus Financial Techniques in Strategic Investment Decisions: An Empirical Study on the Syrian Coastal Region Firms
( 106 ) Corporate Funding and Sustainability of Non- Governmental Organizations in Africa
( 110 ) Financial Deepening, Interest Rate Spread and Economic Growth: New Evidence from Sub-Sahara Africa
( 111 ) Implications of Accountants Unethical Behavior and Corporate Failures
( 113 ) Effects of Corporate Social Responsibility on Banks Financial Performance in Nigeria: A Study of United Bank of Africa
( 116 ) The Moderating Effect of Governance Mechanisms on the Relationship Between Innovation Strategy and the Performance
( 117 ) Public-Private Partnership as a Strategy for E-Governance Funding in Africa: The Gains and the Pains
( 118 ) Does Gold Price Lead or Lags Islamic Stock Market and Strategy Commodity Price? A Study from Malaysia
( 120 ) Profitability of Commercial Bank on Interest Rate Deregulation
( 122 ) Migration as a Livelihood Strategy: The Case of Internal Migration in Ghana
( 123 ) Correlation between Financial Difficulties and Financing Strategies among Market Stallholders in Batangas City
( 124 ) Africa's Human Capital Development: Is Public Finance Management an Effective Strategy?
( 126 ) Determinants of Corporate Tax Avoidance Strategies among Multinational Corporations in Malaysia
( 127 ) The Effect of Corporate Social Responsibility Disclosure on Corporate Financial Performance
( 130 ) Growing and Building: Collaboration of Urban Poverty Reduction Strategy