Vera Songwe: Euro slump makes the CFA zone a victim of ‘imported inflation’

By Yara Rizk
Posted on Monday, 25 July 2022 09:32

A man exchanges euros for West African CFA francs in Abidjan, Ivory Coast, in September 2015.
A man exchanges euros for West African CFA francs in Abidjan, Ivory Coast, in September 2015. Jose Cendon/Bloomberg/Getty

Pegged to the euro, the CFA franc used by 14 West and Central African countries has depreciated against the dollar along with the European currency. Bad news for imports and debt repayment in the region...

For the first time since 2002, the euro and the US dollar have been close to parity. In the space of a year, the European currency has lost 13.2% of its value against the greenback. This has dragged down the CFA franc used in West and Central Africa, which lost 11.46% of its value against the dollar between 31 December 2021 and 11 July, its lowest level for twenty years.