According to the Central Bank of West African States (BCEAO), inflation rose to 4.1 percent in the second quarter of 2024, up from 2.9 percent in the previous quarter.
The primary driver of this increase is a rise in food prices, largely due to low supply and disruptions to internal supply chains caused by ongoing insecurity in certain regions. Additionally, geopolitical tensions in the Middle East and Ukraine have contributed to higher international food prices.
This inflationary trend comes despite a period of relative price stability in the UEMAO.
UEMAO maintains strong economic growth
Despite rising inflation, the West African Economic and Monetary Union (UEMAO) continues to demonstrate robust economic growth. The region’s economy expanded by 5.3 percent in the second quarter of 2024, driven by strong performance in key sectors.
On the external front, the UEMAO’s current account has improved, supported by favorable terms of trade. Member states have also successfully mobilized external resources, strengthening the region’s foreign exchange reserves.
The financial sector remains optimistic about the UEMAO’s economic prospects, with bank loans to private non-financial corporations expected to grow by more than 8 percent in 2024.
At the global level, Jean-Claude Kassi Brou, the Governor of the Central Bank of West African States, noted that economic activity remains dynamic, although challenges persist. While inflation has been relatively stable globally, central banks have maintained cautious monetary policies. Some central banks have begun to reduce interest rates in response to declining inflation in their respective regions.
BCEAO monetary policy committee to discuss key issues
The Central Bank of West African States’ (BCEAO) Monetary Policy Committee (MPC) is set to convene its third ordinary meeting. The committee will review a report on monetary policy in the West African Economic and Monetary Union (UEMAO).
The report will provide an overview of recent economic developments, both domestically and internationally, and assess potential risks to the region’s short- and medium-term economic outlook. Based on this assessment, the MPC will consider proposals for monetary policy measures.
In addition to the monetary policy report, the committee will also discuss the appointment of new members to Guinea-Bissau’s National Credit Council (CNC) and other matters.
ARD/ac/lb/abj/APA