Finance Minister: Cedi Remains Stable Against the US Dollar Since February 19

Finance Minister Dr. Cassiel Ato Forson has stated that the Ghanaian Cedi has experienced relative stability against the US dollar since February 19, 2025, within the interbank foreign exchange market. He revealed that, as of March 14, 2025, the exchange rate was GHS 15.53 per US dollar, reflecting a depreciation of 5.3%. While this represents a decline in the value of the Cedi, it marks a positive shift compared to the 5.7% depreciation recorded during the same period the previous year, indicating some improvement in the currency’s stability.

Dr. Ato Forson made these remarks during a parliamentary session on Tuesday, responding to a question posed by Madam Mavis Nkansah Boadu, the Member of Parliament for Afigya Sekyere East. She had asked about the measures the government is implementing to address the ongoing depreciation of the Cedi against other major trading currencies in the foreign exchange market. In his response, the Finance Minister explained that the government and the Bank of Ghana have taken deliberate steps to maintain a stable exchange rate and reduce volatility in the forex market.

One of the primary strategies outlined by Dr. Ato Forson to stabilize the Cedi is the implementation of tight liquidity management policies by the Central Bank. By controlling the flow of money and ensuring that there is adequate foreign currency in the market, the Bank of Ghana has been able to prevent extreme fluctuations in the value of the Cedi against other currencies. These measures are designed to reduce pressure on the currency and avoid sudden and sharp depreciations that could have a negative impact on inflation and the cost of living in the country.

In addition to these liquidity controls, Dr. Forson also highlighted other key initiatives being undertaken by the government to bolster the resilience of the Cedi. Among the most notable of these initiatives is the establishment of the Gold Board, which is expected to enhance the country’s ability to generate foreign currency. By boosting gold exports and attracting foreign investments in the sector, the government hopes to create a more stable and sustainable source of foreign currency inflows. This, in turn, will help to support the Cedi by increasing the supply of foreign exchange in the market.

The government is also focused on increasing foreign currency availability in the forex market by implementing strategies that encourage the repatriation of earnings from both individuals and businesses operating in Ghana. These strategies aim to boost the supply of dollars and other foreign currencies, which would help to stabilize the exchange rate and mitigate pressures on the Cedi.

Another significant aspect of the government’s strategy to stabilize the currency is its plan to reduce government spending. Dr. Forson mentioned that steps are being taken to frontload actions aimed at cutting down on unnecessary expenditures. By reducing fiscal deficits and limiting the amount of money the government needs to borrow from domestic and international sources, the pressure on the currency would ease, allowing for more favorable exchange rate conditions. This fiscal discipline is critical to maintaining macroeconomic stability and supporting the strength of the Cedi in the long term.

Looking ahead, Dr. Forson assured Parliament that the government is preparing for further measures under its “24-hour economy” initiative, which will focus on stimulating economic activity and productivity across various sectors. One of the key components of this initiative is the introduction of an import substitution policy, which is designed to reduce Ghana’s reliance on imported goods. By promoting local production and consumption, the government aims to conserve foreign exchange and reduce the demand for foreign currencies, ultimately stabilizing the exchange rate and protecting the value of the Cedi.

The Finance Minister also underscored the importance of improving the overall economic environment in order to create conditions that support the stability of the Cedi. This includes creating a favorable investment climate, enhancing the country’s export capabilities, and ensuring that foreign direct investment continues to flow into key sectors of the economy.

In conclusion, Dr. Forson’s statement paints a picture of a government that is actively addressing the challenges facing the Cedi by implementing a range of measures aimed at increasing the stability of the currency. While the depreciation of the Cedi remains a concern, the government’s strategy to manage liquidity, boost foreign currency inflows, reduce expenditure, and promote economic growth holds promise for stabilizing the Cedi in the coming months. The success of these initiatives will be crucial in ensuring that Ghana’s currency remains resilient in the face of global economic challenges.