Throughout 2025, households in the West African Economic and Monetary Union (WAEMU) enjoyed a rare situation: prices that barely moved. According to the Central Bank of West African States (BCEAO), average inflation came in at 0% for the year, down from 3.5% in 2024. That lull now belongs to the past.
Figures released in recent months point to a steady climb. Negative in the first quarter of 2026, at minus 0.2%, price growth rose to 0.4% in the second quarter, then to 1.2% in July and 1.7% in August, according to Governor Jean-Claude Kassi Brou. The central bank’s latest monthly bulletin puts inflation at 1.9% year on year in September. In its economic outlook note, the institution even expected the rate to move above 2% in October.
The main driver of this acceleration is found at the pump. Tensions in the Middle East have pushed up oil prices, and seven of the eight member states have raised fuel prices. Costlier imported food adds to the pressure. In countries where households spend a large share of their budget on food and transport, every increase is quickly felt in daily life.
Faced with this reversal, the BCEAO has so far chosen patience. In March, it cut its main policy rate from 3.25% to 3%, a record low, to make financing easier for the economy. At its meetings in June and again on 9 September, its Monetary Policy Committee left that rate unchanged, along with the marginal lending rate, set at 5%. At the time, the institution forecast average inflation of around 1% for 2026 as a whole.
This caution rests on an economy running at full speed. Growth in the Union reached 6% year on year in the second quarter, after 6.1% in the first, and the central bank still expects 6.1% for the full year. Raising rates too early could slow lending to businesses and governments, whose public finances are already strained by the cost of energy subsidies.
The international backdrop, however, makes the equation harder. On 16 September, one week after the status quo in Dakar, the US Federal Reserve and the European Central Bank each raised their policy rates by 25 basis points. The ECB’s move matters most, since the CFA franc is pegged to the euro at a fixed rate. A widening rate gap between Frankfurt and Dakar can encourage capital outflows and weigh on the Union’s foreign exchange reserves, which underpin the strength of that peg.
The BCEAO nonetheless has some breathing space. Its objective is to keep inflation between 1% and 3%, and the community norm sets a ceiling of 3%. With a rate close to 2%, the Union remains within bounds, far from the levels seen in some neighbouring countries: the central bank itself noted inflation of 15.9% in Nigeria and 5.3% in Ghana in June.
The key question for the last meeting of the year, expected in early December in Dakar, will therefore be a delicate trade-off. If energy prices stabilise, the central bank will be able to extend its status quo and keep supporting growth. If inflation keeps climbing beyond 2%, and if the ECB tightens further, holding the rate at 3% will become harder to defend. After a year of easing, the WAEMU could then enter a new cycle of monetary vigilance.