Ethiopia’s central bank will auction $50 million to commercial lenders and eligible financial institutions on Tuesday, December 2, 2025, as foreign exchange shortages continue to squeeze the market and weaken the local currency.
The National Bank of Ethiopia (NBE) confirmed the auction in a press statement issued on Monday, describing the sale as part of ongoing efforts to “stabilise the local currency and support price and external stability.”
This is the 11th auction since Ethiopia introduced a new foreign exchange trading system in August 2024.
The upcoming sale is $100 million smaller than its previous auction on October 14, when $150 million was offered. At the time of the last offering, the central bank’s injection briefly eased interbank liquidity, but currency pressures persisted, and the birr continued to depreciate in official and parallel markets.
According to the NBE, the latest auction forms part of a larger $520 million intervention plan for the remainder of Ethiopia’s fiscal year ending June 30, 2026.
The bi-weekly programme is designed to give banks scheduled access to foreign currency and reduce market uncertainty.
Submission window and settlement
As part of ongoing efforts to modernise price discovery and execution, the apex bank directed participants to submit their bids via email at 10:00 am and 12:00 noon on the day of the auction.
“The results will be published at 3:00 pm, with settlement set by the end of the day,” the NBE said, adding that successful bidders must complete settlement before the close of business.
Rising pressure
Recent auction pricing reflects Ethiopia’s currency stress even as participation broadens.
In the 10th auction held in October, 31 commercial banks received allocations at a weighted average rate of Birr 148/$1. Earlier auctions in mid-2025 cleared at around Birr 136.6/$1 per US dollar for similar volumes, marking a visible escalation in bid pricing.
Despite the October $150 million liquidity boost, the Birr has since weakened by 4%, now trading at Birr 153.9/$1 at the official window.
The drop underscores persistent disparities between dollar demand for imports and Ethiopia’s foreign currency inflows.
What this matters
Analysts expect the $50 million auction to provide short-term liquidity for banks managing trade-finance pipelines, corporate FX requests, and client import settlements.
However, with the auction size smaller than October’s tranche, competition for clearing may intensify, potentially driving bids higher in the coming sessions if supply dynamics do not improve.
For investors and market participants, the auction maintains NBE’s intervention rhythm and signals continued policy commitment to structured FX access.
