Ghana's Economic Landscape: Cedi Dynamics, Lending Rates, and Calls for Growth

Recent developments in Ghana's economy highlight the interplay between the cedi's exchange rate, lending rates, and the broader financial environment. The Bank of Ghana (BoG) plays a crucial role in managing the cedi's value, emphasizing that it does not create U.S. dollars but rather cedis. When the BoG sells dollars, it reduces cedi liquidity, which has been linked to a stronger cedi. A recent analysis indicated that the cedi appreciated significantly as liquidity tightened, underscoring the importance of domestic monetary conditions in exchange rate stability.

As of January 8, 2026, the cedi traded at GH¢10.67 to the U.S. dollar, reflecting mixed results against major currencies amid ongoing forex pressures. Forex bureaus reported even weaker rates, indicating sustained demand for dollars despite improvements in economic indicators like inflation.

In a related context, Dr. Johnson Asiama, the Governor of the Bank of Ghana, has set a target to reduce lending rates to below 10% by the end of his tenure. This goal aligns with the need for affordable credit to stimulate business and household investment, as current lending rates remain high at around 24.2%. Dr. Asiama noted that the country’s international reserves have reached a record high of $13.8 billion, which could support efforts to stabilize the economy.

Additionally, the Asantehene, Otumfuo Osei Tutu II, has urged the BoG to develop strategies to lower interest rates further, arguing that high borrowing costs are a barrier to economic recovery and job creation. He emphasized the need to transition from a "crippling high-interest environment" to one that fosters growth and wealth creation, particularly as the nation faces ongoing financial challenges. The Asantehene's visit to the BoG included a tour of the new Bank Square complex, symbolizing national confidence in overcoming economic hurdles.