After months of relative calm, Ghana’s cedi has staged an unexpected rally. From February to April 2025, the currency held steady at around GHS15.50 to the US dollar. But in the first weeks of May, it surged to GHS13.1 — marking its strongest level in a year.
The key question now is whether this signals the beginning of a sustained recovery or yet another short-lived rebound.
A Familiar Pattern — But With a Twist
This isn’t the first time the cedi has surprised on the upside. In late 2022, it briefly strengthened from GHS14 to GHS9 before sliding back to GHS12. What makes the current rally different is the duration and relative stability — the longest stretch of calm the cedi has experienced in more than three years.
What’s Fueling the Cedi’s Strength?
1. Record-Breaking Export Earnings
Ghana exported over $2.3 billion in gold during the first two months of 2025 — the highest in over a decade. With global gold prices hitting all-time highs above $3,000 per ounce, this has significantly boosted the country’s foreign exchange reserves.
Meanwhile, cocoa revenues have risen from approximately $600 million to $800 million, aided by favorable global pricing. These two export pillars — gold and cocoa — have injected much-needed hard currency into the economy.
2. A Softer US Dollar
On the global stage, the US dollar has shown signs of weakness, partly due to President Donald Trump’s aggressive trade policies, which have cooled global demand for the greenback. This has indirectly strengthened the cedi.
3. Domestic Fiscal Discipline
The Ghanaian government has taken a firmer stance in the treasury bill market by resisting high-interest rate bids — a move aimed at curbing excessive borrowing and rebuilding investor confidence. The Bank of Ghana also reports no direct intervention in the forex market, though reserves have risen, and the central bank’s gold holdings have swelled to 31.37 tonnes, serving as a buffer against future shocks.
4. Behind-the-Scenes Support
According to the Bank of Ghana’s Head of Financial Stability, part of the recent stability stems from a GHS490 million cash injection in April, targeted at energy sector payments — particularly for independent power producers and fuel imports.
Additional support has come from increased remittances and stronger forex inflows from gold, cocoa, and oil exports.
Broader Currency Gains
The cedi’s strength isn’t limited to the US dollar:
- British Pound: GHS20.60 → GHS17.45
- Euro: GHS17.72 → GHS14.78
- Canadian Dollar: GHS11.00 → GHS9.40
These gains have helped ease inflationary pressure and improve import affordability — at least in the short term.
What This Means for Your Business — JSM Insights
At JS Morlu Ghana, we’re closely monitoring these currency shifts because they directly impact your business operations. Here’s what we recommend:
- Importers & Exporters: Review contract pricing and consider hedging strategies.
- Investors: Monitor global commodity markets and local fiscal policy to assess risk.
- SMEs: Now is a good time to reassess your forex exposure and debt structure.
- All Businesses: Factor currency strength into your mid-year budgeting and forecasting.
Final Thoughts from JS Morlu Ghana
The cedi’s recent rally offers welcome relief, but its sustainability is not guaranteed. If gold and cocoa prices fall or global dollar demand rebounds, the currency could face renewed pressure.
At JS Morlu Ghana, we help businesses navigate uncertainty with data-driven insights and strategic financial planning. Reach out to our team to understand how current trends affect your specific business and how to plan ahead.