Rwandan franc slips against US Dollar

Due to rise of demand for foreign exchange to finance imports in Rwanda, the country’s currency (Rwanda francs) has depreciated by 1.9 percent.

According to the Governor of BRN Mr. Rwangombwa, the exchange rate has not been stable in the first half of the year, with a modulate depreciation of 1.9 percent on the official rate of 2.1 percent on the market rate. He was presenting the monetary policy and financial stability statement in Kigali recently that stated that, the rise in expenditure of 6.8 percent was recorded as compared to same period of 2013 that so much affected the stability of the exchange rate for the first half of the year 2014.

During the first six months of this year, Rwanda Francs depreciated against the US dollar by 1.9 percent and traded between FRW670.08 in December 2013 and FRW 682.54 per dollar a slight increase of FRW11. This depreciation recorded during this period is similar to the 1.8 percent recorded in June last year 2013. This statement further stated that Rwandan franc appreciated against all regional currencies except the Burundian franc.

The Rwandan franc depreciated by 0.6 percet against the Burundian franc appreciating by 0.9 percent against the Kenya shilling, 2.5 percent against the Ugandan shilling and 5.3percent against the Tanzanian shilling. The appreciation is due to the fact that the regional currencies weakened against the United States Dollar.

The increase to 14.8 percent in foreign resources and 6.8 percent in expenditures resulted into a cash excess of US$25.4million in commercial banks created room for the central bank to reduce its forex sales to banks to US$128million compared to US$158million it had planned for.