NBE Moves to Curb Parallel Forex Market Spike

Feb 01, 2026

The National Bank of Ethiopia (NBE) enacted targeted measures in response to a recent surge in the parallel foreign exchange market, which saw the informal USD/ETB rate spike. The actions include a large unscheduled USD auction and a new directive tying import foreign exchange allocations to customs valuation benchmarks, aimed at stabilizing the currency and discouraging informal trading.

Key Takeaways:

Forex spike: Parallel forex rates reached as high as 190 birr per dollar, above official rates below 160 birr.
Large FX injection: USD 500 million was injected via a special forex auction to meet heightened demand.
New directive: Banks must use Ethiopian Customs Commission valuation data when issuing forex for imports.
Objective: Measures target illegal/parallel forex activity and enhance consistency in forex valuations.
Reform context: Steps align with ongoing post-2024 forex market reforms and market-clearing exchange rate systems.

Why It Matters:

The NBE’s intervention seeks to address macroeconomic instability caused by divergence between official and informal forex rates, a risk factor for importers, liquidity management in banks, and broader balance-of-payments dynamics. By linking LC valuations to customs reference prices and supplying significant dollar liquidity, the central bank aims to narrow the gap between official and parallel rates and strengthen price discovery under the reformed forex framework.