Ghana’s currency has recorded its first annual gain against the US dollar since at least 1994, buoyed by record gold prices and broad dollar weakness, according to Bloomberg data.
The cedi has appreciated about 41 percent this year, making it the strongest-performing currency among 144 tracked globally, excluding the Russian ruble.
The rally marks a sharp reversal for a currency that has endured persistent depreciation over the past decade amid fiscal slippages and balance-of-payments pressures.
The gains come a day after Ghana repaid a $709 million Eurobond ahead of schedule, signalling renewed confidence in its debt-restructuring programme and strengthening economic recovery.
The stronger currency has helped ease inflation, which peaked above 54 percent in December 2022 at the height of Ghana’s currency crisis. Price pressures have since cooled, giving policymakers room to unwind earlier emergency tightening without destabilising the exchange rate.
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“The speed of Ghana’s disinflation reflects a rare alignment of tight macroeconomic policy, improved foreign-exchange inflows and restored investor confidence,” SBM Intelligence said in a recent report, noting that International Monetary Fund disbursements under the $3 billion Extended Credit Facility have further boosted sentiment.
As Africa’s largest gold producer, Ghana has benefited directly from the historic surge in bullion prices, which has lifted export earnings, strengthened foreign-exchange inflows and improved investor confidence.
Gold has become an increasingly important stabilising force for the economy as authorities rebuild reserves and restore macroeconomic stability following a period of severe financial stress.
The cedi’s strength has also been supported by a weaker US dollar, with the Bloomberg Dollar Index on track for its steepest annual decline since 2017. The softer dollar has eased pressure on emerging and frontier-market currencies, particularly those linked to commodities.
Overall, the currency’s performance underscores the combined impact of higher commodity prices and tighter domestic policy in restoring confidence in Ghana’s economy, alongside ongoing efforts to curb inflation, rein in deficits and stabilise the financial system after debt restructuring.