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: