Despite Burundi’s inflation rate to have decreased from 27 percent in 2023 to 20 percent in 2024, the International Monetary Fund projected the country’s inflation rate is set to rise to 25 percent next year (2025). The Burundian government has recently adopted policy adjustments, including fiscal consolidation under the revised 2023/24 budget, tightening of monetary policy, and the liberalization of the foreign exchange market.
The country continues to face a shortage of foreign currency, leading to a record high in the parallel foreign exchange market. Currently, the official exchange rate is approximately 2,900 Burundi francs to one U.S. dollar, while the black-market rate is estimated at 7,300 francs per dollar.
uneven growth for Sub-Saharan Africa
The economy of Sub-Saharan Africa is projected to grow by 4.2 percent, according to the latest World Economic Outlook report released by the International Monetary Fund (IMF).
During a press briefing in Washington D.C. on Tuesday, Pierre-Olivier Gourinchas, Economic Counsellor and Director of the Research Department at the IMF, indicated that Sub-Saharan Africa will experience steady growth this year compared to the previous year.
“Last year, the growth rate was approximately 3.6%. We anticipate an increase to about 4.2% next year, indicating a notable pick-up in growth from this year to next,” said Gourinchas.
However, he acknowledged that the region has been adversely been affected by weather shocks and, in some instances conflict. “As a result, growth remains subdued and somewhat uneven, which is certainly a concern for us,” he added.
The IMF reported that in emerging markets and developing economies, disruptions to the production and shipping of commodities—particularly oil—along with conflicts, civil unrest, and extreme weather events have led to downward revisions in the outlook for both the Middle East and Central Asia, as well as Sub-Saharan Africa.
Jean-Marc Natal a Division Chief of the Research Department at the IMF, noted “Over the past year and a half, there has been some progress in the region. Inflation in several countries has decreased, approaching target levels, although in some cases, it remains significantly above those targets—indicating considerable unevenness.”
Global Growth
Global growth is expected to remain stable but underwhelming. Notable revisions have occurred beneath the surface since April 2024, with upgrades to the growth forecast for the United States offsetting downgrades for other advanced economies, particularly the largest European nations.
As global disinflation persists, services price inflation remains elevated in many regions, highlighting the importance of understanding sectoral dynamics and calibrating monetary policy accordingly.