Dr. John Kwakye, who helps the Monetary Policy Committee (MPC) at the Bank of Ghana (BoG), recently shared some important news about the Cedi, which is Ghana's money. He explained that the Cedi is getting stronger, and this is happening for several good reasons.
Dr. Kwakye pointed out a few key reasons that are helping the Cedi stay stable and even improve. Here are some of the main points he mentioned:
One reason is that the government is being careful with how it spends money. This is called fiscal discipline, and it helps keep the economy healthy.
Another reason is that the Bank of Ghana is keeping a close eye on how much money is in circulation. This is known as a tight monetary policy, and it helps control inflation, which is when prices go up.
The Gold Purchase Program is also playing a role. By buying gold, the country can strengthen its economy and make the Cedi more valuable.
There’s also something called the GoldBod policy, which helps manage gold resources better. This is another way to support the Cedi.
High remittances, which is money sent back home by people working in other countries, are also helping. When people send money back to Ghana, it boosts the economy.
The rules for trading money (foreign exchange market) are strong, which helps keep the Cedi stable.
Finally, people are feeling more confident about the economy. When people believe in the economy, they are more likely to invest and spend money, which helps the Cedi.
Dr. Kwakye wants everyone to know that the Cedi's rise is not just a lucky coincidence or something that will go away quickly. He believes it’s the result of careful planning and many strong factors working together. He also warned that people who are just trying to make quick money by betting against the Cedi should be careful!
In short, the Cedi is getting stronger because of smart decisions and good practices in the economy. This is great news for everyone in Ghana!
Dr. Johnson Asiama, the Governor of the Bank of Ghana, recently talked about why prices in Ghana haven't gone down even though the Cedi, which is the local currency, is getting stronger compared to the Dollar.
Dr. Asiama explained that many sellers buy their products when the exchange rate is high. This means they paid more for their goods, so they can't just lower their prices right away. Even though the Cedi is getting stronger, it takes time for prices to change in stores.
But don’t worry! Dr. Asiama promised that prices will start to go down soon, especially if there is competition among sellers. When different stores compete with each other, they often lower their prices to attract more customers.
During a press conference on May 24, Dr. Asiama was asked when people might see lower prices. He explained that because some sellers still have stock from when the exchange rate was high, it will take a little while for prices to adjust.
He reassured everyone that as long as there is competition and no one store has all the power, we will see prices drop soon. So, keep an eye out for those changes..webp)
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When asked if the Cedi, which is Ghana's currency, is going to keep getting stronger, Dr. Asiama explained that we need to look at the bigger picture. He said, “While it’s great to see the Cedi getting stronger, we need to make sure it’s not just a temporary thing. We want the Cedi to be stable, but we also need to check if it’s really improving in a way that helps our economy. The Monetary Policy Committee (MPC) has talked a lot about this and believes that right now, we’re in a good place. The Cedi isn’t getting too strong in a way that would hurt our ability to compete with other countries.”
He added that the Cedi’s strength is mostly because of market forces, not because the central bank is using its money to make it stronger. “If you look at our reports, you’ll see that our reserves are actually growing. We’re not using them to change the market, so the Cedi’s strength is really coming from smart economic policies and money flowing in from other countries. So yes, the Cedi is getting stronger, but our main goal is to keep the exchange rate stable.”
Before answering questions, Dr. Asiama shared that the MPC has decided to keep the Policy Rate at 28 percent. This is the interest rate that affects how much it costs to borrow money.
Dr. Asiama also mentioned that inflation, which is how much prices go up over time, has been going down for the first four months of the year. This is good news because it means that both food and other prices are becoming more stable.
He highlighted that Ghana’s trade situation is looking better, with a current account surplus of $2.1 billion in the first quarter of 2025. This means that Ghana is selling more to other countries than it is buying, thanks to higher prices and more production of gold and cocoa, plus lots of money coming in from people working abroad. Overall, this has led to a total Balance of Payments surplus of $1.1 billion. Because of this strong performance, Ghana’s reserves have grown, reaching $10.7 billion by April 2025, which is enough to cover 4.7 months of imports.
The Cedi has made a strong comeback against other major currencies. This is due to several reasons, like strict money policies, better management of finances, and positive feelings in the market. From the beginning of the year until May 21, 2025, the Cedi has appreciated by 24.1 percent against the US dollar, 16.2 percent against the British pound, and 14.1 percent against the euro.
The latest predictions suggest that inflation will continue to ease, thanks to the tight money policies and stable exchange rates. Inflation is expected to drop faster than previously thought, reaching the medium-term target by early 2026, unless something unexpected happens. However, the Committee noted that inflation is still high compared to what they want it to be, so they will keep their strict policies in place to help bring it down. Because of this, they decided together to keep the policy rate at 28 percent.