Ghana’s currency, the cedi, continues to distinguish itself as Africa’s top-performing currency in 2025, the latest World Bank Africa Pulse Report has stated.
Despite recent pressures, the cedi has sustained a remarkable rally against regional peers — a performance driven by a blend of domestic reforms and improved external conditions.
The cedi, the World Bank reported, has appreciated by about 20% year-to-date in the first eight months of 2025 against the U.S. dollar. The Zambian kwacha followed as the second-best performer, gaining roughly 16% over the same period.
This marks a sharp turnaround from 2024, when the cedi lost nearly 19% during a similar timeframe — making its 2025 rebound especially noteworthy.
What’s driving the Cedi’s strength
- Tight fiscal and monetary policies
Ghana’s government has adopted more disciplined fiscal management — cutting public spending, auditing arrears, and narrowing budget deficits. Meanwhile, the Bank of Ghana has maintained a tight monetary policy stance, helping to anchor inflation expectations and stabilize the currency.
- Rising export revenues
Higher exports of gold, oil, cocoa, and other commodities, coupled with elevated global prices, have increased foreign exchange inflows, easing pressure on the cedi.
- Improved investor confidence
Successful debt restructuring, stronger foreign reserves, and progress in restoring macroeconomic stability have boosted investor sentiment and capital inflows.
- Favourable external conditions
A weaker U.S. dollar, easing global financial conditions, and sustained commodity price strength have supported many African currencies — with Ghana benefiting more than most due to its improved policy environment.
Caution ahead
Despite its strong showing, analysts warn that several factors could challenge the cedi’s momentum. After peaking in mid-2025 — with reports of gains approaching 40% in some months — the currency lost some ground between late July and September.
Import demand ahead of the festive season and election-related spending could put renewed downward pressure on the cedi. Structural vulnerabilities such as import dependency, a narrow export base, and bureaucratic inefficiencies also persist.
Sustaining the gains will require continued fiscal discipline, diversification of exports, and enhanced productivity.
Looking forward
By mid to late 2025, the Ghanaian cedi has staged one of the most striking turnarounds on the continent — from being among the worst performers to topping Africa’s currency rankings.
The World Bank attributes this success to a combination of sound policies, export growth, debt restructuring, and favourable global trends.
However, maintaining this trajectory will demand vigilance. If Ghana can sustain its reforms and guard against external shocks, the cedi’s resurgence could yield lasting benefits — from stabilizing prices to improving debt sustainability and investor confidence.
