The 2022 cedi collapse and Ghana's eurobond default

Ghana's inflation and exchange-rate charts spike dramatically in 2022, when a global rate-hiking cycle, a loss of international bond-market access, and ballooning domestic debt service converged on an economy already running persistent fiscal deficits. The cedi lost roughly 30% of its value against the US dollar over the year, with much of that decline concentrated in a few months when it ranked among the world's worst-performing currencies, while headline inflation climbed from about 13% in January to 54.1% by December 2022. The Bank of Ghana's Monetary Policy Committee responded with a string of aggressive rate hikes, lifting the policy rate from 14.5% to 27% over the course of the year, and in its own January 2023 press release pointed to sharp cedi depreciation and import-price pass-through as the main drivers of the inflation surge. Unable to service its debt, Ghana suspended most external debt payments in December 2022, pursued a domestic debt exchange program in early 2023, and secured a three-billion-dollar IMF Extended Credit Facility in May 2023, its seventeenth IMF-supported program since independence, formalizing a default that reshaped the country's debt and interest-rate charts for years afterward.