Central Bank Governor Reports Dalasi Depreciation Amid Economic Growth Projections
By Buba Gagigo
Central Bank Governor Buah Saidy has reported that the Gambian Dalasi depreciated against key foreign currencies in the first quarter of 2025, despite stable market conditions and a positive economic outlook.
Speaking at the Monetary Policy Committee (MPC) press conference on Thursday, Governor Saidy confirmed that from January to March 2025, the Dalasi depreciated by 1.7% against the US dollar, 0.2% against the British pound sterling, and 0.5% against the CFA franc. However, the Dalasi appreciated against the euro by 1.2% during the same period.
“The exchange rate of the Dalasi continued to be relatively stable, reflecting improved market confidence and supply conditions,” Governor Saidy stated. “From January to March 2025, the Dalasi depreciated against the United States dollar by 1.7%, the British Pound sterling by 0.2%, and the CFA franc by 0.5%. However, the domestic currency appreciated against the euro by 1.2% during the review period. The central bank continues to hold a comfortable level of international reserves amounting to 508.54 million US dollars, as at the end of May 2025, this is sufficient to finance over 4.6 months of prospective imports of goods and services,” Governor Saidy said.
On the domestic front, Governor Saidy projected continued economic growth in 2025 and the medium term. Citing preliminary data from the Gambia Bureau of Statistics, he noted that real GDP grew by 5.3% in 2024, up from the revised 5.0% in 2023.
“Preliminary estimates from the Gambia Bureau of Statistics indicated that real GDP expanded by 5.3% in 2024, higher than the 5.0% revised figure for 2023. Growth was supported by strong performance in the services and industry sectors; agriculture, on the other hand, contracted by 1.1% in 2024 due mainly to unfavorable weather conditions during the past rainy season,” he explained.
Looking ahead, the Central Bank forecasts the Gambian economy to grow by 6.5% in 2025, supported by improved business sentiment, public infrastructure projects, and growth in tourism, financial services, and telecommunications.
Despite this positive outlook, Governor Saidy cautioned that the domestic economy remains vulnerable to external shocks such as commodity price volatility, global trade disruptions, and climate-related risks.
“Despite the favorable outlook the domestic economy remains vulnerable to external shock, particularly commodity price volatility, ongoing global trade fragmentation and climate related risk. The findings of the central bank’s business sentiment survey reveal cautious optimism among respondents with firms expecting a gradual improvement in economic activity in the next quarter. Inflation expectations remain elevated, but have started declining,” he said.
Turning to the external sector, Governor Saidy reported improvements in the balance of payments, driven by higher tourism receipts, consistent remittance inflows, and reduced electricity imports.
The current account deficit narrowed to USD 13.2 million (0.6% of GDP) in the first quarter of 2025, down from USD 21.1 million (0.9% of GDP) in the previous quarter. The trade deficit also declined, from USD 297.1 million (13.0% of GDP) in the fourth quarter of 2024 to USD 248.1 million (10.3% of GDP) in the first quarter of 2025.
“The deficit narrowed to 13.2 million US dollars or 0.6% of GDP in the first quarter of 2025 from 21.1 million US dollars or 0.9% of GDP in the fourth quarter of 2024. The deficit in the goods account narrowed from 297.1 million US dollars, or 13.0% of GDP in the fourth quarter of 2024, to 248.1 million US dollars, or 10.3% of GDP in the first quarter of 2025,” he said.
However, the governor noted that the trade deficit continues to be driven by high imports of fuel, electricity, and food, against a relatively low export base.
“In the first quarter of 2025 total activity volumes measured by aggregate purchase and sales of foreign currency increased to 670.1 million US dollars, compared to 600.9 million US dollars reported In the same period a year ago,” he said.
Private remittance inflows, a key source of foreign currency for The Gambia, amounted to USD 207.9 million in the first quarter of 2025, up from USD 187.2 million in the fourth quarter of 2024. The United States remains the largest source of remittances, accounting for 26.3% of total inflows.