Fitch Solutions has revised its end-of-year projection for the Ghanaian cedi to GHS13.0 per US dollar, down from an earlier estimate of GHS15.5/USD. The revision follows a strong rally in the local currency in recent weeks.
According to the economic research firm, the cedi appreciated by 30% between late April and May 2025, largely due to surging global gold prices.
As a result, Fitch now expects the cedi to strengthen by 12.9% in 2025, compared to the end-2024 rate of GHS14.7/USD.
Positive Outlook for Inflation and Interest Rates
Fitch noted that a stronger cedi will help ease inflationary pressures and allow the Bank of Ghana (BoG) room to cut interest rates later this year. Although the BoG raised its policy rate by 100 basis points in March 2025 to 28.00%, Fitch forecasts a 200 basis point reduction in the second half of 2025, bringing the policy rate down to 26.00% by year-end.
April 2025 saw inflation drop to 21.5%, down from 23.5% in January. Fitch projects that inflation will average 18.0% in 2025, ending the year at 13.1%, close to the pre-COVID average of 12.4% (2015–2019).
Consumer Outlook and Central Bank Position
A stronger cedi is also expected to boost household purchasing power and stimulate consumer demand, especially for imported goods like fuel, pharmaceuticals, and plastics, of which Ghana remains a net importer.
Meanwhile, BoG Governor Dr. Johnson Asiama dismissed speculation that the central bank is targeting a specific cedi level. He emphasized that BoG’s strategy aims to reduce exchange rate volatility, not fix currency thresholds.
“We don’t have such a plan that says when the cedi reaches a certain point, we must act,” Dr. Asiama stated during a post-MPC press briefing.
“Our actions are guided by market dynamics and the broader macroeconomic environment.”
