Ghana has recorded a significant breakthrough in its economic recovery, with inflation dropping to single digits for the first time in four years.
Data from the Ghana Statistical Service (GSS) revealed that the year-on-year consumer price index fell to 9.4% in September 2025, down from 11.5% in August, extending a nine-month streak of disinflation.
The drop was largely fueled by moderating food costs. Food inflation fell sharply to 11% in September from 14.8% the previous month, while non-food inflation also eased to 8.2% from 8.7%.
The development marks a major relief for households and businesses long burdened by high prices. It also means Ghana has exceeded its full-year inflation target ahead of schedule, reinforcing optimism that the economy is stabilizing after years of volatility.
The Bank of Ghana, which had projected inflation would return to its 6–10% target band before the end of 2025, responded swiftly to the milestone. In September, its Monetary Policy Committee (MPC) cut the benchmark policy rate by 350 basis points, from 25% to 21.5%, in a bid to stimulate credit growth and further support the economy.
“This marks the second major rate cut this year,” Bank of Ghana Governor Dr. Johnson Asiama announced. “The decision reflects a sustained decline in inflationary pressures and the expectation of continued fiscal consolidation. It is designed to create space for growth while maintaining stability.”
Economists say the return to single-digit inflation strengthens Ghana’s macroeconomic outlook. They note that the improved stability could boost consumer confidence, attract foreign investment, and bolster exchange rate resilience.
“Ghana now has breathing room to balance growth with stability,” said financial analyst Dr. Efua Osei. “But fiscal discipline must remain central. Without structural reforms, these gains could be reversed by external shocks or domestic overspending.”
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Others highlighted the potential for increased investor appetite. “Sustained low inflation is a signal to global markets that Ghana is serious about macroeconomic reforms,” remarked economic strategist Kojo Mensah. “However, the exchange rate remains a weak spot that could undermine confidence if not addressed.”
Despite progress, the Ghanaian cedi has come under renewed pressure. The currency fell 15% against the U.S. dollar in the third quarter, making it the second-worst performer among major currencies tracked by Bloomberg, after Argentina’s peso.
Analysts attributed the decline to rising demand for foreign exchange as companies rushed to settle import bills ahead of the holiday season. The pressure has also weighed on reserves, which dropped to $10.7 billion in August from $11.1 billion in June.
Even so, the cedi remains up 20% year-to-date, underscoring its relative resilience in 2025.
Economists say Ghana’s key challenge is to maintain single-digit inflation while tackling currency instability. Success in both areas, they argue, will determine whether current gains translate into durable growth and improved living standards.
“Inflation is under control, but exchange rate volatility is the new frontier,” said Dr. Osei. “How policymakers manage this balance will define Ghana’s economic story in the coming years.”