African Currencies faces Volatility as nearly half show Signs of Depreciation

Keep up with the latest news and be part of our weekly giveaways and airtime sharing; follow our WhatsApp channel for more updates. Click to Follow us

Despite steady development across the continent, nearly half of African currencies have shown signs of depreciation, according to the latest report by the African Export-Import Bank (Afreximbank). The report analyzed exchange rate dynamics for May 2025 and revealed a mixed performance across African economies.

For further information, read more details here

Currency Performance

Some countries, such as Ghana, South Africa, Namibia, and Eswatini, recorded currency appreciation during the review period. Kenya and Liberia maintained relative exchange rate stability. However, 10 African countries experienced notable currency depreciation in May. Nigeria’s naira appreciated by 2.1% month-on-month (MoM) against the US dollar but still posted an 11.5% year-on-year (YoY) decline. Ghana’s cedi depreciated sharply by 21.5% MoM and 10.6% YoY.

Afreximbank Insights

The report highlighted a decline in total African trade, which fell to $120.8 billion in February 2025 from $125.9 billion in January. However, this still represented a 0.3% increase compared to February 2024. Afreximbank noted that Africa’s credit landscape is evolving positively, driven by fiscal reforms, improved governance, and resilient economic growth. “Nigeria has received upgrades from both Fitch and Moody’s, reflecting progress in institutional reforms,” the report stated. “As a result, Eurobond yields due in June 2031 have declined by 250 basis points.

Global Challenges

The report warned that global challenges, including stagflation fears, fiscal tightening, geopolitical tensions, and weakening global trade, pose significant downside risks. “Although over half of African countries show stable or improving fundamentals, regional disparities persist, and commodity price volatility continues to weigh on external balances,” the report noted. Afreximbank emphasized the need for African governments to strengthen internal policy buffers and accelerate structural transformation to navigate the uncertain global economic landscape

Please don’t forget to “Allow the notification” so you will be the first to get our gist when we publish it. 
Drop your comment in the section below, and don’t forget to share the post