Keypoints:
- Ghana’s inflation drops to 21.2% in April, the fourth monthly decline
- Stronger Cedi lowers import costs and boosts consumer relief
- Analysts urge caution as BoG watches utility price hikes
GHANA’S economic recovery gained momentum in April 2025, with the national currency, the Cedi, recording a modest appreciation that helped ease import-related pressures and drive inflation down for the fourth consecutive month.
According to the Ghana Statistical Service (GSS), the country’s consumer price index dropped to 21.2 percent in April, down from 22.4 percent in March. Non-food price inflation also slowed to 17.9 percent, from 18.7 percent the previous month — signalling broader economic relief as the stronger currency made imported goods more affordable.
Cedi ranked world’s top performer
The improvement in the Cedi’s performance played a pivotal role in this development. The currency appreciated slightly from GHS15.49 to GHS15.46 against the US dollar between March and April. Bloomberg reported that, as of early May, the Cedi had appreciated by 16 percent against the dollar since the start of April, ranking it the best-performing currency globally during that period.
Government Statistician Alhassan Iddrisu told reporters in Accra on Wednesday that ‘the easing of inflationary pressures is directly linked to the improved exchange rate and the impact of tighter monetary policies in recent months.’
Monetary policy to remain tight
The drop in headline inflation is consistent with a downward trend that began earlier this year under the administration of President John Mahama. Inflation fell from 23.1 percent in February to 22.4 percent in March, reflecting the cumulative impact of currency stability, improved fiscal management, and tighter monetary policy.
In March, the Bank of Ghana made a surprise move by increasing its benchmark interest rate by 100 basis points to 28 percent. The move, aimed at reining in inflation, came amid rising utility costs and persistent fiscal imbalances.
Despite the latest inflation figures, analysts suggest that the central bank is likely to maintain its current policy stance in the short term. Dr Agyapomaa Gyeke-Dako, senior economist at the University of Ghana Business School, said the Monetary Policy Committee (MPC) is likely to wait for more sustained signs of inflation moderation before making any further interest rate decisions.
‘The central bank’s priority remains mopping up excess liquidity,’ she noted. ‘We may not see a policy rate cut yet, especially given continued risks such as utility price hikes and global market volatility.’
Inflation in Ghana has remained in double digits since September 2021, driven b
IMF reforms begin to bite
y the debt crisis and currency depreciation, which spiked the cost of imports. The ongoing IMF-supported reform programme and fiscal consolidation efforts are expected to stabilise prices over time.
The Bank of Ghana projects inflation to fall to around 16 percent by the end of 2025 and return to its medium-term target range of 6–10 percent by the second quarter of 2026.
Meanwhile, the Cedi’s performance has placed Ghana in a favourable spotlight among African economies, alongside the Tunisian Dinar, Moroccan Dirham, and Seychellois Rupee — all of which gained strength in April.
The easing inflationary pressure offers some relief for households and businesses battling high prices since the onset of the country’s economic downturn. However, analysts caution that more structural reforms and export diversification are needed to maintain macroeconomic stability.
Ghana’s finance ministry has yet to comment on whether the recent currency gains will influence upcoming budget adjustments or fiscal policy direction.
For now, the country’s leadership and economic managers are keenly watching to see whether the downward inflation trajectory can be sustained — and whether the Cedi can continue defying regional trends.
