Decrease in exports as the main cause

There is a new increase in the ariary on the interbank foreign exchange market (MID). According to the latest operation completed by the Central Bank, the national currency is now exchanged at 4,884.96 MGA for one EUR. Meanwhile, the dollar is exchanged at 4,513.10 MGA.

Likely, the decrease in exports of key products during the first quarter of this year has had an impact. According to the Central Bank, they recorded a decline of 30.7 %. The drop in global prices led to a nearly 63 % decrease in vanilla exports. Nickel and cobalt exports also slowed due to the international situation.

Nickel, Madagascar’s second-largest export product, experienced a 64 % drop. According to this report, textile trade also saw an 11 % decrease at the beginning of the year. According to the Central Bank, « the prices of major commodities on international markets generally increased in the first quarter of 2024, except for crude oil and nickel prices ».

This is a period of decline for the ariary, which seemed to be recovering earlier this year. Until a few days ago, euro prices were between 4,600 and 4,700 MGA. During the first quarter, the ariary increased by 6.2 % against the euro. According to the Ministry of Economy, this revitalization of the ariary was due to the repatriation and sale of foreign currencies, which performed exceptionally well in the first quarter.