The Bank of Central African States published its first-quarter 2026 analysis of price competitiveness in the Central African Economic and Monetary Community, showing that the region's overall real effective exchange rate excluding oil and gas depreciated by 1.1% from the previous quarter, after a 1.2% decline in fourth-quarter 2025. The move indicates an improvement in CEMAC's price competitiveness in international markets. The gain reflected better performance on both the import and export sides, while the real effective exchange rate remained below the nominal effective exchange rate, pointing to a favorable inflation differential versus trading partners. Quarterly inflation in CEMAC was 0.2% between fourth-quarter 2025 and first-quarter 2026, while the nominal effective exchange rate decline deepened to 0.6% from 0.4%. In real terms, the CFA franc lost ground against key partner currencies, with the largest drop against the Chinese yuan at 2.0%, followed by sterling at 1.0%, the US dollar at 0.2% and the euro at 0.1%. The export real effective exchange rate fell 2.1%, while the import measure remained negative at 0.7%, with contributions of minus 0.6 percentage point and minus 0.5 percentage point respectively to the overall change. The analysis notes that oil and natural gas are excluded from the main calculation in line with international standards. On that basis, the regional real effective exchange rate fell 1.1%, whereas the broader measure including oil and gas appreciated 3.2%. By country, price competitiveness improved in Gabon, Cameroon, the Central African Republic and Equatorial Guinea, while it weakened in Congo and Chad compared with the previous quarter. For second-quarter 2026, the bank said the outlook is uncertain. It linked that uncertainty to the Iran-United States conflict, which could support producer countries' trade balances through higher crude prices but also raise freight costs and imported inflation, potentially narrowing CEMAC's inflation advantage and slowing or reversing recent competitiveness gains.
Banking Commission of the Central African Republic2026-06-12
Bank of Central African States reports 1.1% gain in CEMAC price competitiveness in first quarter 2026
The Bank of Central African States said CEMAC's real effective exchange rate excluding oil and gas fell 1.1% in first-quarter 2026, indicating improved price competitiveness after a 1.2% decline in the previous quarter. The gain was driven by a weaker nominal effective exchange rate and low regional inflation, with both export and import competitiveness contributing to the improvement. The bank said the second-quarter outlook is uncertain because higher oil prices and imported inflation could erode that advantage.