The Ghanaian cedi has emerged as the world’s best-performing currency so far in 2025, soaring nearly 50 percent against the US dollar since the start of the year, according to Bloomberg data. Opening at GH₵10.21/$ on Monday, up 7% from Friday’s close, the cedi has surprised markets with a sustained rally that signals a significant shift in Ghana’s economic fortunes.
The currency had begun the year at GH₵15/$, weighed down by the aftereffects of a 2022 debt default and a severe inflationary crisis.
Today, it is approaching GH₵10/$, representing a near-miraculous turnaround.
Analysts attribute the cedi’s strength to a combination of prudent monetary policy, a boom in commodity exports—especially gold and cocoa—and growing foreign exchange reserves. Ghana, now the world’s sixth-largest gold producer, has benefited from surging global gold prices, which rose from $2,000 per ounce in 2024 to $3,400 in May 2025. Gold export earnings increased from $7.6 billion in 2023 to $11.6 billion in 2024.
A key policy driving local currency demand has been the Gold Board initiative, requiring exporters to settle purchases in cedis first.
This, along with a national trade surplus of $4.3 billion in 2024, has boosted the Bank of Ghana’s gold reserves from 9 tons at the end of 2023 to 31 tons as of May 2025. Ghana’s foreign exchange reserves reached a record $11.4 billion in March 2025.
The Bank of Ghana has supported the cedi’s recovery with tight monetary policy. Despite inflation falling to 21.2% in April, the central bank raised its benchmark policy rate by 100 basis points in March to 28%, citing the need to anchor inflation expectations and sustain capital inflows.
“We cannot assume that stability means complacency,” said BoG Governor Dr. Johnson Asiama. “Our objective remains balancing currency strength with sustained export competitiveness and inflation control.”
The central bank also moved to spot-market foreign exchange auctions, moving away from limit-order-based systems to improve market liquidity and reduce speculative hoarding.
Ghana’s progress has been underpinned by a $3 billion IMF program, which has included measures to halt ₵65 billion in arrears payments and cut Treasury bill yields from 28% to 15%. These steps have bolstered investor confidence, leading to a decline in international bond yields and a revival in foreign direct investment.
However, the central bank remains cautious about potential risks. Economists note that inflationary pressures, driven by rising utility costs, could threaten the cedi’s momentum if monetary conditions are loosened too quickly.
“There is optimism, but also realism,” said Kwesi Nkrumah, an Accra-based economist. “Maintaining this trajectory will depend on managing inflation risks and staying disciplined.”
For Ghana, the cedi’s dramatic surge stands as a sign of resilience after years of economic turbulence—and a reminder of the importance of sound economic management.
