|There have been reports of a reduction the price of goods following the election of Nana Akufo-Addo as president on December 7, 2016. Akufo-Addo’s term starts on January 7, however, automobile spare parts dealers in Accra have reduced prices of goods by 30% due to promises which have been made by the incoming government to reduce import duties. Similar situations have also been reported on other markets in Accra and Kumasi.
In economics, expectations play an important role in determining key macroeconomic indicators. People’s expectation of inflation could cause prices to fall; this is because if people expect prices of goods to fall in the near future, they will wait until after the prices have fallen to make the purchase, this will then cause prices to fall even further.
The public’s confidence in the incoming administration can also have positive implications for the local currency, if people expect the cedi to appreciate, or stay stable, they will not hoard foreign currencies such as the dollar, euro, and pound. Last week, before the general election, the cedi was trading at GH¢4.50 but is currently trading at GH¢4.11, this appreciation has been attributed to the successful conduct of the elections.
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