By: The Fatu Network Editorial
The Gambia’s dalasi is currently the strongest currency in Africa, appreciating by 0.9% against the U.S. dollar this year. This performance surpasses 23 other African currencies. Factors contributing to its strength include increased inflows from remittances, tourism, external budget funding, and disbursements from an IMF program. The dalasi is expected to continue strengthening, mainly against the U.S. dollar, due to anticipated growth in remittances.
In the first two months of this year, Gambia received $129.7 million in remittances, a significant increase from $507 million in 2022. The country also saw a rise in tourism, with 174,490 visitors in 2022 compared to 102,460 the previous year. The upcoming tourism season and peanut harvest are expected to further support the dalasi.
However, Gambia is facing rising inflation rates, reaching 18.4% in July. The central bank governor predicts that inflation will peak in December before decreasing to below 10% by mid-next year.
Source: Bloomberg/ Yahoo Finance