Renowned financial economist, Prof Lord Mensah, has cautioned that the recent appreciation of the Ghanaian cedi may be short-lived if not supported by concrete growth in the country’s real economic sectors.

Speaking on JoyNews’ The Pulse Show, Prof Mensah acknowledged the cedi’s strengthening against the US dollar in recent weeks but stressed that the trend lacks the backing of structural economic fundamentals.

“It’s not going to run forever,” he warned. “If you look at the technical analysis side of it, the dynamics are so sudden, and it’s such a sharp drop for a country like Ghana to sustain.”

He noted that while the current appreciation may reflect efforts to stabilise the currency, it must be viewed within the broader context of Ghana’s economic productivity.

“We saw an upward surge in the cedi against the dollar, which was a depreciation. We are now seeing an appreciation, and obviously, these are trends that any currency on the path to stability will go through,” he explained.

Prof Mensah pointed out that fluctuations—both upward and downward—are typical in early stabilisation phases. However, real and lasting currency strength, he said, depends on strong performance in key sectors such as agriculture, mining, and manufacturing.

“You are going to see an upward swing and a downward swing, and over time you’d have stability,” he noted. “So, we are hoping that the real sector of the Ghanaian economy will kick in within the fiscal year, so we can see the true impact of the appreciation that we are witnessing.”

He added that while fiscal and monetary interventions can influence short-term exchange rate behaviour, sustainable gains will only materialise when underpinned by real sector improvements.

Prof Mensah’s comments come at a time when the cedi’s appreciation is raising cautious optimism among investors and the general public, but economists continue to urge for a more fundamental economic transformation.