Nearly half of African currencies weaken in May amid ongoing economic reforms —Afreximbank

Nearly half of African currencies depreciated in May 2025, reflecting persistent foreign exchange pressures despite ongoing economic reforms and steady growth across much of the continent, the African Export-Import Bank (Afreximbank) has reported.

According to the bank’s June 2025 Monthly Developments in the African Macroeconomic Environment report, sharp contrasts in currency performance exposed the vulnerability of several economies to both domestic fiscal challenges and global economic headwinds.

“Most African currencies have developed steadily, but nearly half have shown signs of depreciation.

“Ten countries experienced significant currency depreciations during this period,” the report stated.

While a handful of countries — including Ghana, South Africa, Namibia, and Eswatini — recorded appreciations, and others such as Kenya and Liberia maintained relative stability, at least 10 nations suffered notable declines.

Nigeria’s naira strengthened by 2.1 percent month-on-month against the US dollar but remained 11.5 percent weaker on a year-on-year basis.

Ghana’s cedi, under sustained pressure, plunged by 21.5 percent month-on-month and 10.6 percent year-on-year, trading at 10.3 to the dollar in May, down from 13.9 over the same period last year.

South Africa’s rand edged down 0.7 percent year-on-year.

Afreximbank further reported a decline in Africa’s total trade, which fell from US$125.9 billion in January 2025 to US$120.8 billion in February.

Intra-African trade dipped to US$18 billion from US$18.6 billion, though both figures reflected year-on-year improvements.

Intra-African trade rose by 5.6 percent, driven by the African Continental Free Trade Area (AfCFTA) and growing regional cooperation.

On the fiscal front, the report cited improvements in Africa’s credit landscape, with several countries securing credit rating upgrades following fiscal reforms and stronger macroeconomic management.

Nigeria received positive revisions from both Fitch and Moody’s, leading to a 250 basis point drop in yields on its Eurobond due in 2031.

Ghana, which had suffered a selective default in 2024, was upgraded to CCC+ by S&P after restructuring its Eurobonds and stabilising its fiscal outlook.

Benin also saw its rating lifted to BB-, attributed to sound fiscal discipline, while South Africa’s rating was maintained at BB- by S&P, though with a cautionary note on the need to address fiscal imbalances and stimulate growth.

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