Exchange rate policies have different impacts depending on the direction of the national currency's fluctuations. An appreciation of the exchange rate reduces the cost of imports and benefits consumers and businesses dependent on imported raw materials. However, it can harm exporters by making their products more expensive on international markets, which weighs on competitiveness and can reduce the revenues of the export-oriented industrial or agricultural sectors.

However, in fixed exchange rate regimes like that of the WAEMU pegged to the euro, this appreciation is often endured rather than chosen, which limits the room for maneuver of monetary authorities but protects the purchasing power of households.

Conversely, a depreciation makes exports more attractive and stimulates activity in export-oriented sectors, but it increases the cost of imported goods, particularly basic necessities and energy. This situation can put pressure on inflation and directly affect household purchasing power, especially in countries where imports cover a significant share of consumption.

However, in flexible exchange rate regimes like those in Nigeria or Ghana, depreciation is an external adjustment tool but exposes urban consumers more to price increases, exacerbating social inequalities.

In West Africa, imports represent on average 40% to 50% of GDP for some countries, making exchange rate fluctuations sensitive for the entire economy. Governments must therefore balance maintaining a stable currency to protect purchasing power with accepting targeted depreciation to support exporters and external competitiveness.

A redistributive nuance emerges: agricultural and industrial exporters benefit from a depreciation, while low-income households, dependent on imported goods, bear the costs. This dilemma illustrates the tension between external competitiveness and social justice.

The success of this policy also depends on coordination with fiscal measures and monetary policy. Effective management combines foreign exchange reserve management, money market interventions, and macroeconomic adjustments to limit negative impacts on inflation while supporting strategic sectors and sustainable growth objectives.

Finally, the Bank of France and the BCEAO remind us that budgetary discipline and transparency of interventions are essential to prevent exchange rate policies from becoming sources of instability or inequitable redistribution.