Cedi records sharpest depreciation among tracked African currencies

Story by: Regina Bless

The Ghana cedi recorded the sharpest depreciation among African currencies monitored by the World Bank during the second quarter of 2026, weakening by nearly 10% between March and June.

The World Bank’s October 2026 Africa Economic Update indicates that the cedi experienced the largest maximum weakening among the currencies tracked following heightened geopolitical tensions and the escalation of the Middle East conflict.

The currencies of Lesotho, Namibia, South Africa and Eswatini followed, each recording maximum depreciation of about 7%. The Seychelles rupee weakened by nearly 7%, while the currencies of the Democratic Republic of Congo and Uganda recorded maximum declines of approximately 6% and 5%, respectively.

The World Bank attributed the broad-based pressure on African currencies partly to rising oil and energy prices. Higher energy costs increased import bills for net energy-importing countries, putting additional pressure on foreign exchange demand and weakening local currencies.

Heightened geopolitical uncertainty also triggered a flight to safer assets, leading to capital outflows from several emerging and frontier markets.

Currency depreciation further increased the local-currency cost of servicing dollar-denominated external debt, creating additional fiscal pressure for countries with significant foreign debt obligations.

Cedi Regains Some Ground

Despite the significant weakening recorded between March and June, the cedi recovered some of its losses by August.

The World Bank noted that currency pressures across much of Sub-Saharan Africa had eased by the end of August, although the cedi remained weaker than its end-February level.

Only about 10 African currencies remained weaker than their end-February positions by the end of August.

The impact of the shock varied across countries. Economies heavily dependent on energy imports, with limited foreign exchange reserves and high debt-service obligations, faced stronger depreciation pressures.

In contrast, commodity-exporting economies showed greater resilience. South Africa benefited from stronger demand for gold and platinum, while oil producers such as Angola and Nigeria gained from higher crude oil prices and increased foreign exchange earnings.

Overall, the cedi’s performance during the second quarter stands out in the World Bank’s assessment, recording the largest maximum weakening among the African currencies monitored, before recovering part of its losses by August.