“Other currencies with significant losses last year include those of Sudan (23.6%), Malawi (20.7%), The Gambia (14.6%), and Nigeria (10.2%),” a statement from the bank reads in part. “Rising food and fuel prices, as well as the depreciation of the exchange rate, were the main drivers of inflationary pressures in the region, and, particularly, in countries like Ghana, Sudan, and Malawi.”
The World Bank estimated that in 2022, the value of the Nigerian Naira fell by 10.2%. This occurred at a time when the nation’s inflation rate in 2022 was high due to rising food and fuel prices. This was disclosed by the international bank in its most recent Africa’s Pulse report for April 2023.
According to the report, persistent supply shocks that drive inflation, such as rising commodity prices and climatic shocks, a lack of central bank autonomy, foreign exchange distortions that widened parallel exchange rate market premia, and fiscal dominance are among the causes of monetary policy’s diminished effectiveness.
