Iran War Currency Devaluations threaten African economies as rising energy costs strain reserves. BMI, a Fitch Solutions unit, warns Burundi’s franc and Malawi’s kwacha face steep declines due to oil import reliance and critically low reserve buffers. Prolonged conflict risks a 2023-style crash, where the franc lost over 25% in a month.

Burundi and Malawi are most exposed, with reserves covering less than a month of imports. Analyst Orson Gard notes policymakers may struggle to defend currencies amid escalatory tensions. The Egyptian pound already hit a 12-month low against the dollar, signaling broader fragility.

Oil exporters like Nigeria and Angola may gain from higher prices, while importers like Kenya and South Africa face depreciation. BMI highlights uneven impacts, with Congo’s franc and Mauritius’ rupee also at risk due to supply chain disruptions and freight costs.

Devaluations could trigger inflation, debt crises, and reduced investment in vulnerable nations. Gard stresses: "Should the US-Iran war escalate, devaluation risks rise substantially." This aligns with 2023’s chaos, where Nigeria and Egypt saw sharp declines.