Wednesday, February 10, 2010

Market Intelligence - Currencies

During the week of 1 – 5 February, most African currencies depreciated against the US dollar as the US dollar strengthened globally. The value of some local currencies plunged steeply against the US dollar, particularly in the DRC (-10.9%), Djibouti (-10.1%), Ethiopia (-4.8%), Comoros (-3.5%), and The Gambia (-3.3%). Five currencies appreciated slightly over the week, including the Burundi Franc (+0.5%), the Guinea Franc (+0.3%), Sierra Leone’s Leone (+0.3%), the South African Rand (+0.2%) and the Tanzanian Shilling (+0.1%).

Currency Focus

Ethiopia: A macroeconomic team chaired by the Prime Minister made the decision on January 30, 2009 to devalue the Birr against the US dollar by 4.8%. This was the fourth government intervention to devalue its currency since October 2008, bringing cumulative devaluation of the Birr to 30%. It was reported that the decision was made in a bid to support exports, which had remained below the target. Exports for the first two quarters of the fiscal year 2009/2010 were registered at USD 709.6 million, compared to the planned USD 1.2 billion. Click here for this week's Market Intelligence Table.