After a steep appreciation that saw the Ghana cedi strengthen nearly 19% to GH₵13.05 per US dollar, financial giant Absa is forecasting a moderated reversal in the local currency’s trajectory, with the exchange rate expected to settle at GH₵14.00/USD by the end of 2025.
In its May 2025 cedi report, Absa attributed the recent surge in the cedi’s value to booming global commodity prices particularly gold and cocoa which have significantly boosted Ghana’s export revenues and enhanced investor sentiment.
“We expect a partial reversal in the cedi towards GH₵14.00/USD by the end of the year so that the real effective exchange rate achieves purchasing power parity again, thereby keeping exports competitive and attracting more financial inflows. Overall, we expect the cedi to average GH₵14.16/USD in 2025.” The report noted,
The cedi had held steady around GH₵15.50/USD for two months before rallying aggressively, fueled by stronger-than-expected export receipts and increased foreign exchange support from the Bank of Ghana. Absa flagged the rally as excessive, stating, “At these levels, however, we believe the cedi has rallied too aggressively.”
Key to the cedi’s recent strength was the central bank’s ability to convert strong export inflows into official reserves, enabling it to inject more foreign currency into the interbank market.
“In turn, the Bank of Ghana has been able to supply more hard currency to the interbank market, which has driven the exchange rate sharply lower from GH₵15.50/USD a month ago to GH₵13.05/USD currently,” the report said.
While the current macroeconomic landscape appears favourable underpinned by strong gold prices, anticipated increases in gold and cocoa output, and improved reserve buffers Absa anticipates a more balanced exchange rate path as the year progresses. The bank believes a return to more sustainable levels will help maintain Ghana’s export competitiveness and align with broader monetary policy objectives.
