The Ghanaian cedi’s exchange rate against the US dollar has been a source of anxiety for both domestic and international stakeholders, particularly given Ghana’s exclusion from the international capital market in 2025. This concern stems from the previous administration’s reliance on Eurobond issuances to artificially bolster foreign exchange reserves, a strategy that ultimately proved unsustainable and led to a significant devaluation of the cedi. The currency’s decline continued through 2024, depreciating by 28% against the dollar.
However, the political landscape shifted with the election of a new, fiscally responsible government. This change, combined with favorable developments in international commodity markets, has dramatically altered the cedi’s trajectory. While the currency experienced a sharp depreciation in the first quarter of 2025 as the new administration settled in, subsequent months have witnessed marginal appreciation and relative stability. The Bank of Ghana, under the leadership of Dr. Johnson Asiama, has implemented a series of measures aimed at stabilizing the cedi, including tightening monetary policy, bolstering foreign exchange reserves, and introducing structural reforms to address exchange rate misalignment. These policy interventions, coupled with proactive market support through direct forex injections, reflect a commitment to maintaining currency stability.
A crucial factor contributing to Ghana’s improved economic outlook is the surge in international gold prices, reaching unprecedented levels and boosting the country’s foreign exchange reserves. This positive trend is further reinforced by increased investment in gold production and the government’s efforts to formalize small-scale mining operations, curbing illicit activities and maximizing revenue generation from this sector. Databank Research predicts that the government’s focus on domestic mining will further augment gold reserves, providing a cushion for the cedi.
While falling oil prices offer potential benefits for consumers and reduced energy costs, they also pose a risk to government revenue targets from crude oil exports. Cocoa prices remain relatively high, although a significant portion of Ghana’s cocoa production is allocated to fulfilling previously defaulted supply contracts. Despite these external factors, the government’s prudent fiscal management and sound economic policies are yielding positive results, attracting both domestic and international attention.
The post-election political stability is expected to stimulate foreign direct investment and portfolio inflows, further easing pressure on the cedi. Databank Research anticipates that disciplined fiscal policies will reinforce this recovery, creating a positive feedback loop that strengthens investor confidence and reduces speculative attacks on the currency. The successful Eurobond debt restructuring in 2024 has already led to credit rating upgrades from Moody’s and Fitch, which are projected to further improve investor sentiment and contribute to the cedi’s stability.
Although specific exchange rate forecasts vary among different analysts, the consensus points towards relative stability for the cedi throughout 2025. Forecasts from Coin Codex and Deloitte anticipate a relatively stable exchange rate range, primarily driven by improved investor confidence, successful debt restructuring, IMF disbursements, and robust gold exports. Gov Capital forecasts a similar outlook. This projected stability suggests that speculative currency trading against the cedi may be less attractive compared to alternative investment options within Ghana, such as government or central bank bills offering potentially higher returns.
