President John Dramani Mahama has assured Ghanaians that the Cedi will not equate to $1, stating that the Bank of Ghana is closely monitoring the situation to prevent any potential collapse of the export sector.
According to him, the recent appreciation of the cedi is due to close coordination between fiscal and monetary policies by the Central Bank and the Ministry of Finance.
This increase in value is driven by the foreign exchange auction system, which works based on demand and supply.
Speaking at the presidency during a multi-sectoral meeting on the 24-hour economy policy on May 28, 2025,
President Mahama explained that the Bank of Ghana conducts a forex auction to determine how many cedis in the market need foreign exchange to pay various bills and obligations.
He added that those who need foreign currency place bids in the auction. The Bank then calculates an average exchange rate, accepts the cedis, and provides the corresponding dollars.
“The Cedi recently has appreciated in value and it is the result of close coordination between fiscal and monetary between the Central Bank and Ministry of Finance. It’s based on the forex auction and demand and supply. What happens is the Bank of Ghana does its forex auction, it finds out how much cedis are in the system that need forex to pay various bills and others. And those who want the forex bid on the auction and the Bank strikes the average and takes the cedis and makes the dollars available.”
He further said that the dollar’s depreciation is not caused by anyone deliberately pushing it down. Instead, it reflects the true value of the cedi as determined by bids in the forex market based on demand and supply. This system is expected to stabilize the cedi at its real value.
President Mahama explained that the idea of the cedi reaching GHC 1 to $1 is extreme and would severely damage the country’s export sector.
He also said that the Governor of the Bank of Ghana is actively watching the situation and will intervene if the exchange rate falls below a certain level.
Credit: ANGELONLINE