Top 10 Most Depreciated African Currencies

Almost all Sub-Saharan currencies have continued to depreciate against the US Dollar. The continued depreciation of the currencies in Sub-Saharan Africa is attributable to the increased inflationary pressures in many countries in the region given the effects of Russia’s invasion of Ukraine on commodity prices and supply chains.

The Ghanaian Cedi was the worst performer in H1’2022 having depreciated by 29.1 percent on YTD. The performance is attributable to a deteriorating macroeconomic environment, amid increasing concerns over public debt sustainability with the public debt to GDP ratio reaching 81.8 percent in 2021.

The Kenya Shilling depreciated by 4.1 percent in H1’2022 to close at 117.8 shillings against the US Dollar, compared to 113.2 shillings recorded at the beginning of the year.

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On a Year To Date change, the worst performing currencies are:

1. Ghanian Cedi (-29.1)
2. Malawian Kwacha (-24.8%)
3. Ugandan Shilling (-5.8)
4. Kenyan Shilling (-4.1%)
5. Botswana Pula (-3.8%)
6. Mauritius Rupee (-3.1%)
7. Zambian Kwacha (-2.6%)
8. Tanzanian Shilling (-1.1)
9. South African Rand (-0.9%)
10. Nigerian Naira (-0.6%)

In terms of how the currencies have depreciated in the past 12 months, here is the performance:

1. Ghanian Cedi (-35.9%)
2. Malawian Kwacha (-26.5%)
3. Botswana Pula (-12.8%)
4. South African Rand (-12.1%)
5. Kenyan Shilling (-9.2%)
6. Ugandan Shilling (-5.4%)
7. Mauritius Rupee (-5.3%)
8. Nigerian Naira (-1.1%)
9. Tanzanian Shilling (-0.5%)
10. Zambian Kwacha (+24.0%)

At the same time, Global commodity prices registered mixed performance in H1’2022, with prices of precious metals declining by 4.0% largely driven by reduced demand for safe-haven assets, a situation accentuated by the United States interest rate hike that has seen investors opt for higher-yield-bearing assets.

On the other hand, fertilizer prices recorded the highest increase, gaining by 110.3% in H1’2022, mainly attributable to the mismatch between demand and supply arising from supply chain constraints, as a result of the Russian government’s decision to halt fertilizer exports in a retaliatory move following sanctions for their role in the Russia-Ukraine Conflict.

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