The 1994 CFA devaluation and a gold-driven economy

Burkina Faso uses the CFA franc issued by the Central Bank of West African States (BCEAO), which was pegged to the French franc until January 1994, when the currency was devalued by half, to 100 CFA francs per French franc, and later pegged to the euro. The devaluation raised the local price of imports and, along with fiscal reform, helped restore export competitiveness, and Burkina Faso's cotton exports and then a gold-mining boom after 2008 became the country's main sources of foreign exchange. Because monetary policy is set regionally, inflation has generally stayed low and close to the union's target, with the main swings coming from food prices and the harvest. From 2015 growing insecurity, military coups in 2022, and drought have reduced output and displaced people, which explains the weakness in Burkina Faso's growth series despite the stability of its currency.