BoG dismisses export fears as cedi rallies

Governor Dr. Johnson Pandit Asiama addressed the media about currency issues. He stated that Ghana does not face real appreciation problems affecting competitiveness. The Monetary Policy Committee (MPC) assessed currency movements in both nominal and real terms.

In 2025, the Ghanaian cedi gained against major currencies. It appreciated by 24.1% against the U.S. dollar, 16.2% against the British pound, and 14.1% against the euro. This improvement was supported by a strong trade surplus and higher foreign reserves.

The real effective exchange rate dropped from 156.3 in October 2024 to 136.4 in April 2025. This indicates improved competitiveness and better export performance for Ghana. Gross international reserves increased to US$10.17 billion, while net reserves reached US$7.26 billion.

The cedi's strong performance highlights specific advantages for Ghana, especially in gold and cocoa exports. The central bank aims to avoid persistent real appreciation that could harm export competitiveness and economic recovery.

Currently, there is no evidence of such distortion, according to Dr. Asiama. He emphasized that it is crucial for the cedi not to appreciate consistently in real terms.

The bank operates a managed float regime rather than targeting a fixed exchange rate. This allows market-based fluctuations with limited interventions during disorderly conditions.

Dr. Asiama noted that exchange rates must fluctuate but should not swing excessively. Recent movements align with Ghana’s macroeconomic stabilization efforts after years of volatility.

The central bank wants to showcase the cedi's strength as a sign of restored policy credibility and improving fundamentals.

Ghana's path includes fiscal consolidation, tighter monetary conditions, and structural reforms under an IMF-supported program.

These efforts aim to create a more stable exchange rate environment moving forward.

This year, the cedi has steadily appreciated due to tight monetary policy and rising foreign inflows.

The bank insists these gains are market-driven rather than artificial interventions using reserves.

Dr. Asiama explained that economic policies and international flows drive this appreciation, including remittances and commodity exports like gold and cocoa.

Ghana’s external sector is performing well with a widening trade surplus supporting the cedi's strength.

Unlike previous short-lived appreciations reliant on central bank support, this trend appears more resilient now.

The stronger cedi also aids in controlling inflation as part of the central bank’s strategy.

Inflation fell to 21.2% in April from over 54% in late 2022 due to this appreciation making dollar-priced goods cheaper.

Dr. Asiama reiterated their end-year inflation target of