Published: September 10, 2025
MONROVIA — The Central Bank of Liberia (CBL) has assured the public there is no shortage of Liberian dollars in circulation, countering concerns that scarcity is driving recent movements in the exchange rate.
The statement, issued Wednesday, followed a sharp appreciation of the Liberian dollar against the U.S. dollar in less than a week, raising speculation of cash shortages.
Strong Liquidity in the Banking System
CBL said commercial banks hold sufficient cash to meet demand for salaries, settlements, and private sector transactions. As of September 3, 2025, commercial banks reportedly held L$1.65 billion in vault balances, while their excess reserves nearly doubled year-on-year to L$2.02 billion.
“These do not reflect Liberia’s actual Liberian dollar financial conditions, which remain stable and resilient,” the Bank said, dismissing rumors of scarcity as speculation, hoarding, and misinterpretation.
The CBL itself maintains “strong reserves” to support the system, the release noted.
Exchange Rate Gains
On September 8, the Liberian dollar traded at about L$180 to US$1 (buying), compared to L$201.08 to US$1 at the end of August — a 10.5 percent appreciation in just one week. A CBL survey on September 9 recorded L$182.94 to US$1 (buying) and L$184.94 to US$1 (selling).
The Bank attributed the gain to monetary tightening, remittance inflows, and structural reforms. Since April, it has kept the Monetary Policy Rate at 17.25 percent and sterilized more than L$13 billion to stabilize the foreign exchange market. Remittances reached US$425.9 million in the first half of 2025, while improved road connectivity has expanded economic activity beyond Monrovia.
Inflation has also eased, dropping from 13.1 percent in February to 7.4 percent in July, with further declines projected.
Economic Fundamentals
The CBL said lower transport costs, expanded energy access, and stronger agricultural output are helping reinforce confidence in the Liberian dollar. A reduced fiscal deficit and the adoption of the Pan-African Payment and Settlement System (PAPSS) for cross-border trade are also boosting stability.
“There is no shortage of Liberian dollars in the financial system,” Executive Governor Henry F. Saamoi said. “The recent appreciation of the currency reflects sound policy measures, structural improvements, and improving economic fundamentals. The Central Bank remains vigilant in safeguarding exchange rate stability, ensuring liquidity, and building confidence in the economy.”
The Bank urged the public to avoid panic withdrawals and hoarding, warning that such practices create artificial pressure on the market. It reaffirmed its commitment to sustaining liquidity, maintaining macroeconomic stability, and strengthening confidence in the Liberian dollar.
Discussion about this post