Investment analyst and Head of EDC Stock Brokers Mahama Iddrisu has told Citi Business News the recent downgrade of Ghana by Standard and Poor\u2019s (S&P) will negatively affect government bonds.
\nMahama Iddrisu speaking to Citi Business news on the impact of the downgrade on the Ghana Stock Exchange said government bonds will be the worst hit.
\nStandard and Poor\u2019s on Friday announced it had downgraded Ghana\u2019s long term currency credit rating from \u2018B\u2019 to B-.
\nS&P argues that despite the successful billion dollar loans issued to Ghana by international investors, the Ghanaian economy was in a precarious situation, considering staggering current account deficits.
\nS&P\u2019s downgrade comes at a time that some analysts believe talks with the International Monetary fund (IMF) could boost investor confidence.
\nGhana is seeking a 3 year programme with the IMF, which could possibly start in the first quarter of next year.
\nHead of EDC Stock Brokers Mahama Iddrisu speaking to Citi Business News said the impact will mainly stem from \u201cinvestors who are looking at government bonds and the ability of government to pay. They will also look at how government is managing the economy in line with their objectives.\u201d
\nAccording to him equity investors \u201care looking at the performance of the companies even though the general performance of the economy will affect the performance of the companies\u201d.
\nThe downgrade to a large extent measures government\u2019s ability to repay its sovereign debt. Government has so far issued three Eurobonds with two currently listed on the Ghana stock Exchange.
\nMahama Iddrisu says\u201cif government cannot pay the interest that will accrue on the bonds, it is going to affect investment.\u201d
\n\u201cThat will go a long way to affect how investors look at Ghana and their ability to put money into any instrument present in the country\u201d, he added.
\nGovernment has this year already suspended the issue of two of its domestic bonds with some analysts citing unfavourable market conditions.<\/p>\n
By: Anim Kwaku Boadu\/citifmonline.com\/Ghana<\/p>\n","protected":false},"excerpt":{"rendered":"
Investment analyst and Head of EDC Stock Brokers Mahama Iddrisu has told Citi Business News the recent downgrade of Ghana by Standard and Poor\u2019s (S&P) will negatively affect government bonds. Mahama Iddrisu speaking to Citi Business news on the impact of the downgrade on the Ghana Stock Exchange said government bonds will be the worst […]<\/p>\n","protected":false},"author":14,"featured_media":59994,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jnews-multi-image_gallery":[],"jnews_single_post":[],"jnews_primary_category":[],"jnews_social_meta":[],"jnews_override_counter":[],"footnotes":""},"categories":[19],"tags":[4],"class_list":["post-59993","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-health","tag-st-augustines-college"],"_links":{"self":[{"href":"https:\/\/citifmonline.com\/index.php?rest_route=\/wp\/v2\/posts\/59993","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/citifmonline.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/citifmonline.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/citifmonline.com\/index.php?rest_route=\/wp\/v2\/users\/14"}],"replies":[{"embeddable":true,"href":"https:\/\/citifmonline.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=59993"}],"version-history":[{"count":0,"href":"https:\/\/citifmonline.com\/index.php?rest_route=\/wp\/v2\/posts\/59993\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/citifmonline.com\/index.php?rest_route=\/wp\/v2\/media\/59994"}],"wp:attachment":[{"href":"https:\/\/citifmonline.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=59993"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/citifmonline.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=59993"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/citifmonline.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=59993"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}