Fatshimetrie, October 17, 2024 – Currency fluctuations are key indicators of a country’s economy. The Democratic Republic of Congo recently experienced an appreciation of its currency, the Congolese franc, against the US dollar on the official market. This appreciation of 1.38% saw the exchange rate rise to 2,812.83 CDF per US dollar during the week of October 4 to 11, compared to 2,851.68 CDF the previous week.
This change in exchange rates, observed on both the indicative and parallel markets, reflects the trends in the foreign exchange market in the DRC. While the Congolese franc appreciated by 1.38% on the official market, it lost slightly in value on the parallel market, with a depreciation of 0.22%. This duality of movements raises questions about the internal and external economic dynamics that influence the value of the national currency.
The DRC’s foreign exchange reserves, valued at USD 6,264.59 million as of October 9, 2024, represent a crucial indicator of the country’s financial stability. With 14 weeks of imports of goods and services covered by these reserves, the situation seems relatively under control. However, it is appropriate to analyze in more depth the factors underlying the depreciation of the Congolese franc against the US dollar.
Several elements are identified as catalysts for this downward trend in the national currency. The strong demand for US dollars for imports and international payments, the scarcity of foreign currencies available on the foreign exchange market, the external orientation of the Congolese economy and the structural deficit in the productive sector contribute to weakening the rate of the Congolese franc.
The Central Bank of Congo recommends multiple measures to address the deep roots of this monetary instability. Coordination between monetary and fiscal policy, a rigorous fiscal consolidation program, optimized management of the State’s treasury and diversification of the economy are all suggested avenues to strengthen the resilience of the Congolese franc and stabilize foreign exchange markets.
Ultimately, the appreciation of the Congolese franc on the official market and its relative depreciation in parallel underscore the complexity of the economic challenges facing the DRC. By adopting an integrated and strategic approach, the authorities could consolidate the country’s financial position and promote a more stable and prosperous economic environment for the entire Congolese population.