Ethiopia: Dollar Bids Top 133 Birr At Latest Nbe Forex Auction

The weighted average of all successful bids in the latest round of the central bank’s forex auctions registered at 133.17 Birr per USD.

Fourteen banks bid against one another for the USD 50 million on offer during what was the sixth foreign currency auction organized by the National Bank of Ethiopia (NBE) since the market was liberalized in mid 2024.

The first auction, in August, saw 27 banks bid an average of 107.9 Birr for a US Dollar. When the second took place almost eight months later, the Birr had weakened 26 percent against the greenback.

At the end of March, central bank regulators announced that auctions would take place every two weeks for “several months” in a bid to provide the private sector with “some portion of the foreign exchange accumulation that has been taking place.”

– Advertisement -A March 31 statement from the NBE claimed its forex reserves had reached record levels owing to rising exports, increased remittances, and higher capital inflow.

The Birr gained slightly during an auction held the next day, with the weighted average bid registering at 131.71 per US Dollar. The central bank offered USD 130 million in two more auctions over the following month, which both saw the Birr lose ground. Today’s bidding continued the trend.

This week also saw the central bank introduce another round of changes to its forex policies.

Importers are now able to take up to USD 50,000 from banks for upfront payments to suppliers, 10 times more than the previous limit. Regulators have also scaled up the amount of forex that travelers can purchase from banks to USD 10,000 (USD 15,000 for business travelers) and limited the amount that banks can charge for forex service to no more than four percent per transaction.