Ethiopia’s central bank will offer $150 million in a foreign exchange (FX) auction on October 14, 2025, marking the latest effort to stabilise the birr and support liquidity in the banking system. The National Bank of Ethiopia (NBE) said the auction comes on the back of stronger foreign inflows and reserves.
In a statement issued Monday, the NBE noted that part of these proceeds would be allocated to commercial banks, in line with its “price and external stability objectives.”
The auction, open to all commercial banks, is scheduled to run from 10:00 am to 12:00 noon, with results announced at 3:00 pm and settlement by the end of the day.
“The foreign exchange supply conditions continue to be robust, and business and individual demand for foreign exchange is being widely addressed by the banking system,” the statement said The NBE added that it will continue conducting periodic auctions “as needed” to ensure smooth market functioning.
“The business community and the wider public should remain reassured that Ethiopia’s formal foreign exchange markets are addressing FX demand and will continue to do so in the period ahead,” the NBE added, signalling its commitment to orderly markets.
This upcoming auction is the tenth since the introduction of Ethiopia’s new foreign exchange trading system in August 2024. The last auction, held on August 5, also involved $150 million, with 28 banks allocated funds at a weighted average rate of 138.25 birr per US dollar.
Broader reforms
The central bank’s move comes as Ethiopia advances its economic reform agenda, aimed at modernising markets and liberalising the economy.
Over the past two years, key measures, such as floating the birr, introducing a central bank policy rate, and opening the banking sector to foreign investors, have begun to reshape the financial landscape.
These reforms have contributed to a notable moderation in inflation, which fell to 13.9% in 2024/25 from 19.9% the previous year, providing the central bank with greater flexibility to manage monetary conditions.
At the same time, foreign exchange inflows reached a record $32 billion, up 33% from the prior year, reflecting stronger exports of both goods and services and signalling improved external stability.
Private-sector lending has also accelerated, with total bank loans reaching 822.8 billion birr ($5.6 billion), of which 77% was directed to productive enterprises.
On the macroeconomic front, these reforms have underpinned an 8.8% expansion in gross domestic product over the past year, as sectors critical to growth posted strong performance.
The government now projects growth of 9% in the current fiscal year, beginning July 8, signalling continued momentum as macroeconomic conditions stabilise.
Note: The local currency figures were converted to their estimated U.S dollar equivalent using 146.7 ETB/$1 as of October 13, 2025.
