Ghana’s economy is at a crossroads. The cedi, once battered by depreciation and inflationary pressures, has staged a remarkable recovery in 2025, appreciating by 16.29% against the US dollar year-to-date. Coupled with declining global oil prices, this has lowered the cost of imported petroleum products, offering a glimmer of hope for consumers. Yet, despite these macroeconomic gains, prices of goods remain stubbornly high. The Ghana Union of Traders’ Associations (GUTA), a powerful stakeholder group, has called on wholesalers and retailers to lower prices—a plea met with skepticism and resistance. Indeed the dynamics of this economic tug-of-war are complex which is why Ghana’s path to price stability remains fraught with challenges.
GUTA’s case for price reductions
GUTA’s appeal hinges on the principle of fairness. Historically, traders have swiftly adjusted prices upward during the cedi’s depreciation cycles, passing forex volatility costs to consumers. Now, with the cedi stabilizing at GHc12.92 to the dollar (retail) and GHc12.89 (interbank) as of May 2025, GUTA argues that traders must reciprocate by reducing prices. “It is conscionable to reflect the cedi’s strength in pricing,” emphasizes GUTA President Dr. Joseph Obeng, noting that sustained currency gains should curb inflation and boost purchasing power.
The government has echoed this sentiment. Trade Minister Elizabeth Ofosu-Adjare has praised GUTA’s initiative, stating, “If traders increased prices when the dollar rose, fairness demands adjustments downwards now.”
Lower prices could stimulate consumer spending, driving GDP growth—a critical need for an economy still recovering from 2023’s 3.1% growth slump. Moreover, with petroleum imports becoming cheaper due to global price trends and the cedi’s strength, fuel-dependent sectors like transportation and manufacturing have room to recalibrate costs.
Trader Resistance results from a legacy of distrust and sheer pragmatism
Despite these appeals, many traders are hesitant. Their resistance stems from a cycle of distrust in Ghana’s economic stability. Dr. Obeng acknowledged this, explaining, “Traders fear the cedi’s gains are fleeting. Past appreciations in 2020 and 2022 were followed by sharp depreciations, leaving businesses exposed to losses.”
For instance, in December 2022, inflation soared to 54.1% shortly after a similar GUTA directive, eroding any consumer benefits.
Inventory costs further complicate matters. Traders who stocked goods during the cedi’s weaker periods (e.g., at GH¢16 to one US dollar in early 2025) face potential losses if they slash prices prematurely.
“We bought goods at higher rates. Adjusting prices now could bankrupt small businesses,” argued a Kumasi-based retailer in a JoyNews interview. Additionally, non-imported goods—such as locally grown produce—are less affected by forex shifts, limiting the scope of price reductions.
Government’s measures and structural challenges
The Mahama administration has sought to reassure stakeholders. Finance Minister, Dr Cassiel Ato Forson highlighted “strategic economic management,” including IMF-backed reforms and debt restructuring, as pillars of the cedi’s recovery. The IMF’s US$370 million disbursement and Standard &Poor’s credit rating upgrade of Ghana to ‘CCC+’ reflect growing investor confidence. However, structural issues persist. Inflation remains elevated at over 21% as at April, driven by food prices, while fiscal deficits and energy sector losses threaten long-term stability.
Critics argue that without systemic reforms—such as tax base expansion and energy sector modernization—currency gains alone cannot sustain price reductions. The World Bank notes that Ghana’s poverty rate may rise to 51.2% by 2027, underscoring the urgency of equitable growth.
Balancing optimism and realism
For prices to fall sustainably, stakeholders emphasize two prerequisites:
One is policy consistency in that the Bank of Ghana must maintain stringent forex controls and fiscal discipline to prevent volatility.
The other is sectoral collaboration through dialogues between GUTA, government, and traders which could establish phased price adjustments, based on lower average inventory costs..
President Mahama’s 24-hour economy initiative and agro-industrial reforms aim to reduce import dependency, potentially insulating prices from forex swings. Meanwhile, consumers await tangible relief. As Accra-based teacher Ama Serwah has lamented, “The cedi’s gains mean little if market prices don’t reflect them.”
So will prices fall?
Ghana’s price reduction debate encapsulates the tension between short-term relief and long-term economic resilience. While GUTA’s call aligns with broader recovery goals, trader resistance underscores deep-seated systemic fragilities. The government’s ability to sustain reforms—and traders’ willingness to adapt—will determine whether this moment becomes a turning point or another missed opportunity. As Dr. Obeng has cautioned, “Stability must translate into productivity. Only then can Ghana truly prosper.”
