Story By: Akua Oteng Amponsah
Fitch Solutions has revised its end-of-year forecast for the cedi-to-dollar rate to GH¢13.0, down from its previous projection of GH¢15.5.
The UK-based firm is now forecasting a 12.9% appreciation of the cedi against the US dollar in 2025.
According to Fitch Solutions, the cedi’s appreciation is driven by higher gold prices, which have led to a 16% gain between late April and mid-May 2025.
“The cedi has appreciated by 16% between late April and the middle of May on the back of higher gold prices, resulting in our Country Risk team revising down their end-2025 forecast for the Ghanaian cedi to GH¢13.0/US dollar, from our previous projection of GH¢15.5/US dollar. We now forecast that the currency will strengthen by 12.9% over 2025, from GH¢14.7/US dollar at the end of 2024.”
The stronger cedi is expected to create room for the Bank of Ghana (BoG) to pivot back to monetary easing.
“As Ghana is a net importer of key consumer goods—including fuel, cereals, pharmaceuticals, and plastics—a stronger exchange rate will have a disinflationary effect. Although the BoG delivered a surprise 100 basis-point rate hike in March, easing inflationary pressures—driven by exchange rate gains—should provide scope for a more accommodative stance in the second half of the year,” Fitch Solutions stated.
The firm expects the BoG to cut the policy rate by a cumulative 200 basis points in the second half of 2025, ending the year at 26.00%.
“We therefore expect the BoG to cut the policy rate by a cumulative 200 basis points in H2 2025, ending the year at 26.00%. These factors will serve to increase purchasing power for households and be the key drivers of faster spending growth.
