In October 2024, key factors influencing currency changes included new policies promoting the use of local currencies at official rates, rising interest rates, and economic conditions. The Afghan afghani strengthened due to recent government policies. In contrast, the Russian ruble declined as heightened prices, and interest rates took their toll. The Ethiopian birr weakened after the decision to float against the U.S. dollar. The Venezuelan bolivar depreciated due to currency shortages and the loss of foreign assets, while the Suriname dollar faces depreciation from high foreign debt and interest rates. Similarly, rising interest rates impacted the value of Zimbabwean gold, a newly introduced currency.
Global Currency Shifts: Why the Afghani, Ruble, Birr, and More Are Gaining or Losing Value Against the Dollar
Currencies Gaining Value Against the U.S. Dollar:
AFN - Afghani
The Interim Taliban Administration (ITA) has introduced new policies that have resulted in the strengthening of the afghani. These measures are designed to reduce the outflow of foreign currency and promote transactions in the local currency. The increased demand for the afghani has led to its appreciation. However, there are concerns that the ITA’s new monetary policies may be unsustainable and could potentially have adverse effects on the economy.
Currencies Losing Value Against the U.S. Dollar:
RUB - Russian Ruble
Despite an interest rate hike and rising oil prices, the Russian ruble has depreciated. In mid-October, the Central Bank of Russia raised the key interest rate, a move typically expected to strengthen a currency. Additionally, oil prices—a significant export for Russia— have increased. Despite all this, the ruble has declined recently, puzzling experts. One economist suggests that a high demand for foreign currency might be a contributing factor. The future trajectory of the ruble remains uncertain, with experts anticipating increased volatility for the remainder of the year.
ETB - Ethiopian Birr
The Ethiopian birr has continued to depreciate following the National Bank of Ethiopia’s decision to float the currency against the U.S. dollar in July. This policy shift aimed to reduce government control and establish a market-determined exchange rate. The intended objectives were to stabilize Ethiopia’s economy and attract increased foreign investment. However, since the implementation of this decision, the birr has experienced significant depreciation.
Venezuela - VES
The Venezuelan bolivar has continued to depreciate as the country faces significant shortages of hard currency. The gap between the official exchange rate and the black-market rate continues to widen, despite the devaluation. The auction of Citgo, a major international asset for Venezuela, to a U.S. company may have further contributed to the bolivar’s weakening. Venezuelan officials have expressed concerns that the sale price for Citgo was insufficient and therefore led to even greater losses for the economy.
Suriname - SRD
Suriname is currently facing a steep devaluation of its currency, primarily due to high levels of foreign debt and rising inflation rates. As a result, the country is working to restructure its national debt and recently became a member of the International Development Association, which is part of the World Bank. Suriname has also secured a deal with Total Energies for offshore oil drilling. Although profits from this venture are not expected to materialize for some time, the anticipated economic boost could be substantial.
Zimbabwe - ZWG
Zimbabwean gold has depreciated significantly over the past month. The gold has remained volatile in the few months since it replaced the Zimbabwean dollar as the official currency of the country in April 2024. The government implemented this drastic decrease in response to the widening gap between official and unofficial currency rates. As the gap has become unsustainably wide and locals have been erring on the side of the black-market rate, the government aims to encourage the use of the official rate through this move. Initially, officials intended the introduction of gold to help manage the country’s high inflation rates, but the recent loss in value and ongoing inflation have undermined public confidence in the new currency.
Explore in-depth information on currency changes and cost of living adjustments here.
