Cedi will depreciate by December if local production is neglected – IEA warns

The Institute of Economic Affairs (IEA) has issued a warning. The Ghanaian Cedi may depreciate again by December 2025. This could happen if the government does not focus on local production and export-led growth.

The IEA stated that current policies might only provide temporary relief. Significant efforts are needed to boost domestic productivity, especially in key export sectors.

At a press briefing in Accra on May 27, 2025, Professor Vladimir Antwi-Danso spoke about this issue. He cautioned that the recent appreciation of the Cedi might be short-lived.

He urged policymakers to move from short-term fixes to long-term strategies. These strategies should enhance industrialization, value addition, and export competitiveness.

Professor Antwi-Danso said, “Our forex appreciating is not the answer.” He emphasized the need for Ghana to become an export economy. This approach would stabilize the economy and lower other currencies.

He warned that without these changes, Ghana would relapse by December. His comments were based on technical analysis rather than political views.

Meanwhile, Dr. Johnson Asiamah, Governor of the Bank of Ghana, responded to claims about currency manipulation. At the Ghana CEO Summit on May 26, he denied that the Central Bank was artificially boosting the Cedi's value.

Dr. Asiamah explained that the Cedi’s performance is due to strong macroeconomic fundamentals. He noted that it has appreciated by 24.1% against the US dollar.

He emphasized that the Central Bank is not using reserves to support this appreciation. Instead, disciplined monetary policy and targeted reforms are at play.

Dr. Asiamah added that improved remittance flows and market surveillance contribute to stability. These measures are structural changes aimed at ensuring long-term economic health.