The Bank of Ghana has announced plans to ramp up key reforms aimed at solidifying the recent gains made by the cedi, which has appreciated by nearly 19% year-to-date.
This impressive rally in the local currency has been largely driven by a combination of fiscal discipline and stringent monetary policies.
Bank of Ghana Governor, Dr. Johnson Asiamah, emphasized that the next phase of reforms will focus on sustaining foreign exchange inflows and enhancing regulatory oversight in the forex market.
Speaking at the opening of the Bank’s 124th Monetary Policy Committee (MPC) meeting on Wednesday, Dr. Asiamah highlighted that the cedi’s 19% appreciation between April and May had significantly eased imported inflation pressures and restored public confidence. This positive trend reflects a mix of prudent monetary policies, improved market sentiment, and gains in the external sector.
However, the Governor cautioned that despite these positive developments, significant challenges remain. “The inflation outlook, while improving, is still vulnerable to second-round effects, food supply constraints—particularly from northern Ghana and the Sahel—and external price shocks from volatile global commodity markets,” he said.
He also pointed out that geopolitical tensions and evolving global trade dynamics, such as recent US-led tariff disputes, have increased market uncertainty, potentially affecting commodity prices, exchange rates, and financial flows in emerging markets like Ghana.
The MPC meeting is taking place amid continued cedi strength against the US dollar and ongoing efforts to control inflation. In its last meeting in March, the Committee raised the policy rate by 100 basis points to 28% to manage inflation expectations. However, given the signs of currency stability and easing global pressures, the market is now leaning towards maintaining the policy rate to support lending rates and the broader economic recovery.
The meeting will conclude on Friday, May 23, 2025, with a press briefing to announce the new policy stance.
