- Cedi’s Major Rebound Against the Dollar: The Ghanaian cedi appreciated 24.1% against the USD from January to May 2025, reversing sharp losses from 2024.
- Biggest Monthly Gain in Years: In just one month (April–May 2025), the cedi surged 16.4% against the USD, crossing the GHC 12 mark for the first time since 2023.
- From Depreciation to Appreciation: After steep drops in 2024 (over -27% against major currencies), the cedi flipped the narrative in 2025 with solid double-digit recoveries.
- Improved Competitiveness via REER: The Real Effective Exchange Rate (REER) fell to 136.4 in April 2025, improving Ghana’s export price competitiveness.
- Eurozone Currencies Took a Hit: The euro fell to GHC 13.34, and the pound declined 12%, reflecting both cedi strength and external factors like Brexit-related GBP softness.
- Exports and Remittances Drove Gains: Strong gold and cocoa exports plus record remittance inflows pushed Ghana’s current account surplus to $2.1 billion in Q1 2025.
- Global Dollar Weakness Helped: The US dollar index dropped to 99.6 (May 2025) from 108.5 (Dec 2024), giving breathing space to emerging market currencies like the cedi.
- Ghana Outperformed Other Emerging Markets: The cedi’s appreciation (+3.8% YTD) beat the average +1.9% gain among emerging market currencies in 2025.
- Stronger Cedi Helped Lower Inflation: The cedi’s strength coincided with a drop in inflation, from 27.8% in Dec 2024 to 21.2% by April 2025.
- Policy Tools Did Their Job: The Bank of Ghana’s 28% policy rate and the new currency-matching reserve requirement (effective June 2025) bolstered forex stability.
So What?
Ghana’s exchange rate performance in 2025 is a rare and welcome turnaround story, built on firm monetary policy, strong export fundamentals, and favorable global dynamics. The challenge now is consistency: maintaining policy discipline and structural support to ensure this momentum is not only celebrated but sustained.
