Climate Anomalies and Price Dynamics: Insights from Sub-Saharan African Currency Unions

Climate Anomalies and Price Dynamics: Insights from Sub-Saharan African Currency Unions | Research Square window.SnipcartSettings = { analytics: { enabled: false } }; (function() { var accessVector = localStorage.getItem('access_vector') || ''; window.dataLayer = window.dataLayer || []; if (accessVector) { window.dataLayer.push({ user: { profile: { profileInfo: { snid: accessVector } } } }); } })(); (function(w,d,s,l,i){w[l]=w[l]||[];w[l].push({'gtm.start':new Date().getTime(),event:'gtm.js'});var f=d.getElementsByTagName(s)[0],j=d.createElement(s),dl=l!='dataLayer'?'&l='+l:'';j.async=true;j.src='https://www.googletagmanager.com/gtm.js?id='+i+dl;f.parentNode.insertBefore(j,f);})(window,document,'script','dataLayer','GTM-K279D39R'); Browse Preprints In Review Journals COVID-19 Preprints AJE Video Bytes Research Tools Research Promotion AJE Professional Editing AJE Rubriq About Preprint Platform In Review Editorial Policies Our Team Advisory Board Help Center Sign In Submit a Preprint Cite Share Download PDF Research Article Climate Anomalies and Price Dynamics: Insights from Sub-Saharan African Currency Unions Xavier Emmanuel Wend Kuni Compaore, Hamza Bennani, Camille Aït-Youcef This is a preprint; it has not been peer reviewed by a journal. https://doi.org/ 10.21203/rs.3.rs-7107621/v1 This work is licensed under a CC BY 4.0 License Status: Under Review Version 1 posted 4 You are reading this latest preprint version Abstract This paper examines the dynamic impact of climate anomalies on consumer prices within two Sub-Saharan African (SSA) currency unions: the West African Monetary Union (WAMU) and the Central African Monetary Union (CAMU). Using a local projections method on a monthly panel dataset spanning 2002M1–2019M12, we find that temperature and precipitation anomalies lead to short-term increases in consumer prices of up to 1 percentage point and 0.1 percentage point, respectively, at the currency union level. Country-level estimations reveal significant heterogeneity, with some economies experiencing inflationary pressures lasting beyond two years. While countries’ reliance on the agricultural sector appears to be the main transmission channel of these inflationary effects, interestingly, economic development, energy consumption, and political stability emerge as effective moderating factors. Given the limited monetary policy autonomy of the two currency unions, targeted adaptation strategies, such as investments in climate-resilient agriculture and renewable energy, are essential to prevent these climate-related inflationary risks. JEL classification: E31, Q54, O13. Climate Anomalies Inflation Local Projections Sub-Saharan Africa' Full Text Supplementary Files ElectronicSupplementalMaterial.pdf Cite Share Download PDF Status: Under Review Version 1 posted Reviewers agreed at journal 16 Sep, 2025 Reviewers invited by journal 16 Sep, 2025 Editor assigned by journal 22 Jul, 2025 First submitted to journal 21 Jul, 2025 You are reading this latest preprint version Research Square lets you share your work early, gain feedback from the community, and start making changes to your manuscript prior to peer review in a journal. As a division of Research Square Company, we’re committed to making research communication faster, fairer, and more useful. We do this by developing innovative software and high quality services for the global research community. Our growing team is made up of researchers and industry professionals working together to solve the most critical problems facing scientific publishing. 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