According to data published by the National Bank of Rwanda (BNR) on Wednesday, the Rwandan Franc (Rwf) saw a depreciation of 32.75 percent relative to the Kenyan Shilling in 2024, which marks a significant shift from the 6.89 percent appreciation observed in 2023.
The franc lost 12.85% of its value compared to the Tanzanian shilling after experiencing a decline of 9.78% in 2023. According to central bank statistics, the currency also declined by 5.37% relative to the Burundian franc and by 12.73% when measured against the Ugandan shilling. "The Rwandan Franc experienced greater depreciation versus the Kenyan Shilling in 2024 due to heightened foreign exchange inflows into Kenya, shifts in monetary policies, the Kenyan government's purchase back of their Eurobonds, as well as changes in the foreign exchange markets," stated the central bank report.
The report indicated that the Ugandan shilling gained strength relative to the franc because of greater financial inflows from enhanced coffee exports, increasing foreign direct investments in the oil and gas sector, and boosted tourism revenues. According to official statistics, Uganda welcomed around 1.5 million visitors in 2024.
"In nominal effective terms, the Rwandan franc weakened against a basket of major trading partner currencies."
"During 2024, this depreciation amounted to 7.2%, which marked an improvement over the 10.5% decline seen in 2023. On a real effective basis, however, the Franc’s depreciation stood at only 4.5%, down slightly from the previous year's 10.3%."
These changes were mainly attributed to larger favorable differences in inflation rates between Rwanda and its trade partners noted during December 2024.
In 2024, the franc saw a devaluation of 9.42 percent compared to the US dollar on an annual basis, marking a considerable deceleration from the 18.05 percent decline observed in 2023.
Rwanda’s central bank explains the dollar shortage. The Rwandan franc declined more slowly compared to other significant global currencies; it dropped by 7.53 percent relative to the British pound and by 2.83 percent vis-Ã -vis the euro. However, it strengthened slightly by 1.03 percent against the Japanese yen.
These fluctuations in exchange rates stand in stark contrast to those observed in 2023, where the franc depreciated by 25.50 percent relative to the British pound, 22.50 percent compared to the euro, and 10.78 percent versus the Japanese yen.
Rwanda’s trade with the East African Community (EAC) continued to expand in 2024, reflecting increased regional demand, but exports to the EAC grew by 8.2 percent to hit $276 million, up from $255 million in 2023.
This expansion was fueled by an increase in exports of agricultural items and manufactured commodities. Likewise, purchases from the EAC surged considerably by 15.2 percent, amounting to $998 million in 2024, up from $866 million in the prior year.
This increase was primarily due to greater imports of food items, building supplies, and finished products, indicating stronger local consumption and ongoing infrastructure initiatives.
Consequently, Rwanda’s trade deficit within the EAC expanded by an additional 18.1 percent to reach $722 million from $611 million in 2023, as reported by the central bank. This information was provided by SyndiGate Media Inc. Syndigate.info ).
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