By Kwesi Nyame-Baafi, PhD

Following the victory of the National Democratic Congress (NDC) at the 2024 Presidential and Parliamentary Elections, the cedi debate has received little attention and misleading reports from mainstream media and ""new" media.

This has been quite surprising as the issue should receive the necessary attention with accurate reportage for Ghanaians and policy analysts to know the true state of our currency in order to be able to contribute or assist in proposing policies that strengthen our cedi.

Also, for a true “reset” of the economy as promised by the National Democratic Congress (NDC), competent management of our local currency must be applied.

Referencing an article published by myjoyonline on 3rd February 2025; “Cedi continues strong run against dollar; One dollar equals GH¢15.81”, according to their report, the local currency has appreciated by 1.11%, 0.78%, and 0.6% week-on-week against the US dollar, pound, and euro, respectively.

This is good news to Ghanaians if it were factual or true, but unfortunately, this headline is misleading. Examining this Joynews report, the author seems to have concluded on the headline by focusing on a week-on-week analysis. Hence, it is crucial to consider the broader context to ascertain the facts.

So, what has been the performance of the Cedi so far?

To properly assess this subject, it is important we examine the performance of the cedi for the entire year. In this case, January 2025, as February just began. Also, compare the performance of the cedi to that of the previous year to ascertain the strength of the cedi.

According to historical Interbank FX Rates, data available on the Bank of Ghana's website, it shows that the Ghanaian cedi has been on a downward spiral since the beginning of the year.

Just to put things in perspective, the Cedi weakened by 2.4% against the US Dollar, 3.0% against the Euro and 0.8% against the British Pound in January this year (Bank of Ghana Summary Report, 2025). This compares to a depreciation rate of 0.7% to the dollar and 0.6% to the pound in January 2024 per the same report conducted in 2024.

The 2025 BoG summary document indicates an exchange rate of GHS 15.06 to the dollar, GHS 18.55 per pound and GHS 15.69 per Euro as at January this year. Nevertheless, dollar rates observed at forex bureaus and at the black market range from GHS15.9 all the way to GHS16.4 (data from Joy Business) for January 2025. These figures compare to a dollar rate of GHS14.74 as of 6th January 2025 per BoG data.

Against this context, it will, therefore, be disingenuous for one to claim that there is a strong cedi run against the dollar. In actual fact, the cedi is struggling against major currencies, casting dark shadows on the cost of living, and government finances, among many others.

The data paints a clear picture: the cedi's struggles persist. While short-term fluctuations may offer fleeting moments of optimism, the overall trend points to a worrying decline. It is imperative that the government, in collaboration with economic experts and informed citizens, takes decisive action to address the underlying factors contributing to the cedi's depreciation. The future of Ghana's economy depends on it.

The writer, Kwesi Nyame-Baafi, PhD is a Development Economist