Ghana’s cedi recorded its mildest first-quarter loss in at least six years, closing March at GH¢10.98 to the dollar, as a sustained macroeconomic recovery kept seasonal depreciation pressures well below historical norms. The milestone, however, comes with a forward outlook shaped by sharply diverging commodity fortunes and a simmering geopolitical flashpoint that analysts say could cut both ways for the currency through year-end.
The local currency shed 4.4 percent against the dollar in the three months to March, roughly half the 8.7 percent average first-quarter depreciation recorded over the preceding five years, according to analysis by Black Star Group. For context, the same metric stood at 20.6 percent in Q1 2022, at the depth of Ghana’s fiscal crisis. The Bank of Ghana’s (BoG) interbank mid-rate stood at GH¢11.02 as of April 13, indicating the currency has held its ground into the second quarter.
The quarterly swing range, from GH¢10.46 at its strongest to GH¢11.00 at its weakest, a spread of 54 pesewas, was unusually narrow, signalling that the volatility that defined the crisis years has markedly receded.
A changed monetary landscape
The recovery has been powered by structural shifts across the economy. Inflation fell to 3.2 percent in March, its lowest level in years, while the Monetary Policy Rate (MPR) was cut by 400 basis points in the first quarter alone, taking the benchmark to 14 percent following 900 basis points of reductions in 2025. The Ghana Reference Rate (GRR) dropped to 11.71 percent in tandem.
Perhaps most striking is the collapse in Treasury bill yields. Rates that stood between 28 and 30 percent in early 2025 fell to 4.8 percent for the 91-day instrument, 6.6 percent for the 182-day and 9.8 percent for the 364-day, marking the first time T-bill returns have entered single digits since the debt crisis erupted.
“The domestic environment is now characterised by lower costs of capital and a resurgence in investor appetite,” Black Star’s analytics team wrote in its Q1 report.
Black Star and Databank Research both project a year-end rate of GH¢12.60 to GH¢12.85, an approximately 15 percent decline from current levels, a depreciation path that would still leave the cedi more than 17 percent stronger than the GH¢15.53 it touched in early 2025.
Gold lifts, cocoa drags
The commodity picture heading into Q2 presents a study in contrasts. Gold, the nation’s dominant export earner, rose 7.06 percent in Q1, and the escalating confrontation between the United States and Iran has pushed oil prices sharply higher, introducing fresh upside potential for Ghana’s external accounts. A sustained gold rally would amplify the country’s record export earnings and bolster BoG reserves, building on the approximately US$10 billion the central bank injected into the foreign exchange market during 2025 through its Domestic Gold Purchase Programme.
Oil’s climb, however, carries a countervailing risk. Higher pump prices could quickly reverse transport inflation, currently running at minus 7.3 percent year-on-year, one of the few deflationary categories in the consumer price basket, potentially reigniting headline inflation and increasing the import bill.
Cocoa delivered an outright shock. Ghana’s Cocoa Board (COCOBOD) faces a difficult juncture after the commodity shed 45.6 percent in Q1, the steepest quarterly fall in Black Star’s six-year data series, amid strong global harvest projections and near-term oversupply. A government decision to raise the farmgate price by up to 50 percent adds to COCOBOD’s cost burden at an inopportune moment.
Broad money growth has ticked up to around 16 percent, a figure analysts are monitoring for any signs of demand-side inflationary pressure. Black Star projects that oil price pass-through and base-effect normalisation will push inflation back to a 7.5 to 8.5 percent range by December.
The overall read from the first quarter is that Ghana’s currency recovery is real, disciplined, and increasingly embedded in policy credibility. Whether it holds depends heavily on how the commodity and geopolitical crosswinds evolve in the months ahead.
Sources: Black Star Group Q1 2026 Report, Databank Research, Bank of Ghana
