The Ghana cedi recorded the highest depreciation among African currencies monitored by the World Bank during the second quarter of 2026, weakening by nearly 10% between March and June.
The development was contained in the World Bank’s October 2026 Africa Economic Update, which assessed movements in exchange rates following the escalation of the conflict in the Middle East.
According to the report, the cedi registered the largest maximum weakening among the currencies tracked during the period.
The currencies of Lesotho, Namibia, South Africa and Eswatini followed, each recording maximum depreciation of about 7%. The Seychelles rupee also weakened by nearly 7%, while the Democratic Republic of Congo and Uganda recorded maximum declines of approximately 6% and 5%, respectively.
Currencies including those of Botswana, Zambia and Mauritius experienced comparatively smaller periods of maximum weakening, generally ranging between 3% and 5%.
The World Bank said the pressure was widespread across the region, although the extent varied from one country to another.
“Most countries with available daily exchange rate data recorded currency depreciations during the second quarter of 2026 relative to end-February, before the conflict intensified. In seven of the 22 countries monitored (excluding the CFA franc zone), the maximum depreciation exceeded 5.0%, including in the Democratic Republic of Congo, Ghana, the Seychelles, and South Africa.”
What drove the depreciation?
The World Bank linked the depreciation across African currencies partly to the surge in oil and energy prices that followed the escalation of the Middle East conflict.
For countries that rely heavily on energy imports, the higher prices increased import costs and demand for US dollars, putting additional pressure on foreign exchange reserves and local currencies.
The report also identified increased geopolitical uncertainty as another factor behind the currency movements.
According to the World Bank, heightened uncertainty prompted investors to seek safer assets and reallocate capital away from emerging and frontier markets, creating additional pressure on African currencies.
The depreciation also had implications for countries with substantial external debt. A weaker local currency increased the domestic-currency cost of servicing debt denominated in US dollars, adding to existing fiscal pressures.
Cedi regains some value by August
Despite recording the largest maximum weakening between March and June, the cedi regained some ground in the months that followed.
The World Bank’s data show that although the cedi remained below its end-February level by the end of August, the extent of its depreciation had eased significantly from its peak.
The report said currency pressures across much of Africa had moderated by August.
“By end-August, however, much of this pressure had eased, with only 10 currencies remaining weaker than their end-February levels.”
The World Bank noted that the effects of the external shock were uneven across Sub-Saharan Africa, with countries facing different levels of exposure depending on their energy needs, foreign exchange buffers and debt obligations.
Economies that depend heavily on imported energy and have limited foreign exchange reserves came under greater pressure, while countries with strong commodity exports were better positioned to absorb the shock.
South Africa, for example, benefited from stronger demand for gold and platinum, which helped support foreign exchange earnings despite increased risk aversion in global markets.
Oil-producing countries, including Angola and Nigeria, also gained from higher crude oil prices. Increased oil export receipts provided additional foreign currency inflows and helped cushion their currencies against the broader depreciation pressures.
The World Bank’s assessment therefore places the cedi at the top of the list of African currencies that experienced the sharpest maximum weakening between March and June 2026, even though it recovered part of those losses by August.
