“Economic news in the Democratic Republic of Congo is marked by a worrying situation: the continued depreciation of the Congolese franc against the US dollar. According to a recent report by the country’s Central Bank, this downward trend is having repercussions on the market foreign exchange as well as on goods and services.
During the last week of June 2023, inflation increased significantly, reaching 0.59% compared to 0.24% the previous week. This inflation is mainly due to the increase in the prices of food and non-alcoholic beverages, housing, water, gas, electricity and transport. The main cities of the country, such as Kinshasa, Lubumbashi and Goma, are particularly affected by this price increase.
At the same time, the exchange rate of the Congolese franc against the US dollar also experienced a depreciation. The report indicates that as of June 29, 2023, the indicative exchange rate was 2.411 Congolese francs per US dollar. This depreciation is also reflected in the parallel market, where the exchange rate stands at 2.427.5 Congolese francs for one US dollar.
Faced with this situation, the Governor of the Central Bank of Congo recalled the measures taken to counter this depreciation, such as raising the bank’s key rate and increasing the coefficient of the compulsory reserve on deposits in Congolese francs. These measures aim to reduce the pressure exerted by excess liquidity on the prices of goods and the exchange rate.
It is also underlined the importance for the government to continue to support local production in order to reduce dependence on imports. At the same time, exchange offices and manual currency traders are reminded to scrupulously comply with the regulations in force, particularly with regard to the public display of exchange rates, in order to combat speculation.
In a context of mixed global economic growth and persistent inflationary pressures, the Governor of the Central Bank recommends continued coordination of monetary and fiscal policies, as well as the maintenance of the stability pact to ensure zero monetary financing of the State deficit .
This worrying situation of the depreciation of the Congolese franc against the US dollar highlights the economic challenges that the country must face. It is essential to implement effective measures to stabilize the national currency and promote economic growth in order to guarantee a more favorable situation for the Congolese population