Bank of Ghana Governor, Dr Johnson Pandit Asiama, has said that one of the most powerful signals a central bank can send to markets is policy consistency, especially during periods of uncertainty.
In this spirit, he said, at its most recent meeting held just days ago, the Monetary Policy Committee (MPC) of the Bank of Ghana unanimously voted to maintain the policy rate at 28%.
“This decision was grounded in a clear and focused objective: to consolidate the gains in disinflation while maintaining confidence in Ghana’s macroeconomic framework,” he said during a Roundtable decision at the 2025 Africa Development Bank (AfDB) Meetings held in Abidjan, Côte d’Ivoire.
Inflation, he added, has declined from 23.8% at the end of 2024 to 21.2% in April 2025.
“While we recognize that risks remain — including food supply constraints and external commodity price volatility — we are seeing steady improvement in core inflation metrics and inflation expectations.
“Our approach is forward-looking but cautious. The current tight monetary stance will be maintained until inflation expectations are fully re-anchored and headline inflation returns sustainably toward our medium-term target of 8 ± 2 percent.
“We have also initiated important structural reforms in our liquidity management operations. We are transitioning away from passive instruments like the unremunerated Cash Reserve Ratio
to a more active Open Market Operations (OMO) regime,” he said.
Cedi Stability
Understandably, Dr Asiama said, many investors and observers are asking whether the Cedi’s current strength can hold
“Let me address that directly. As of May 20, 2025, the Ghana cedi has appreciated by 21.5% year-to-date — a remarkable reversal from the 19.2% depreciation experienced in 2024. But this appreciation is not
speculative, not artificial, and not temporary. It is grounded in fundamentals.”
He referred to a few key drivers for his analysis.
“Robust foreign exchange inflows from exports, particularly gold, which has surged to
over US$3,200/oz due to global uncertainty, The Gold-for-Reserve programme, which has enhanced BoG’s ability to accumulate reserves while reducing pressure on open-market dollar purchases, A current account surplus of US$2.12 billion in Q1 2025, and strong net reserve accumulation — now at US$10.67 billion, Stable remittance flows, supported by structural reforms and improved transfer systems, even as external risks like a proposed U.S. remittance tax and slowing global growth loom,” he cited.
“Even as we remain vigilant, we believe the cedi is entering a new phase of anchored stability. Yes, global dynamics including a possible rebound in the U.S. dollar or an easing of gold prices could soften external support. But Ghana’s domestic policy stance is strong enough to cushion such shifts.”
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