ETHIOPIA · MARKETS
Key Facts
- —The country Ethiopia is a landlocked Horn of Africa nation that let its currency, the birr, trade more freely in July 2024 under an IMF-backed reform.
- —What happened On Tuesday 6 October, Ethiopia’s central bank set six dollar auctions of US$140 million each from 13 October, Birr Metrics and Capital reported.
- —The numbers The US$840 million total is 68% above last quarter’s four regular rounds of US$125 million, which excluded a special US$500 million sale in August.
- —The signal Deputy Governor Fikadu Digafe said in late September that the auctions will not continue permanently, The Reporter wrote in Amharic.
- —The rate The central bank’s rate was about 161 birr per US dollar on 7 October; Capital puts the Addis Ababa street rate near 180.
- —Still open The central bank has not said when the auctions will end or how it will size future rounds.
Ethiopia dollar auctions will total US$840 million this quarter, as the National Bank of Ethiopia sells more hard currency to commercial banks. Two Ethiopian business outlets, Birr Metrics and Capital, reported the schedule on Tuesday 6 October: six rounds of US$140 million from 13 October.
For US investors, importers and companies trying to move money out of Ethiopia, the extra dollars are meant to ease a long shortage. Yet the central bank’s own chief economist says the auctions are a bridge, not a permanent fixture.
What the Central Bank Will Sell Through December
The six dollar auctions fall on Tuesdays: 13 and 27 October, 10 and 24 November, and 8 and 22 December. Each offers US$140 million, against US$125 million at each regular auction last quarter.
In the first quarter of Ethiopia’s fiscal year, the bank offered US$500 million through four regular auctions, according to Capital. That excludes a special US$500 million sale on 20 August, so the 68% rise applies to the regular schedule.
The National Bank of Ethiopia is the country’s central bank, led by Governor Eyob Tekalign. It sets monetary policy, supervises lenders and holds the country’s foreign currency reserves.
In each auction, the bank offers a fixed amount of US dollars and commercial banks bid for them in birr. The highest bids are served until the dollars run out, and the results show what banks will pay for dollars.
Why the Central Bank Calls the Auctions Temporary
The new schedule comes days after a senior official said the dollar auctions are not meant to last. Fikadu Digafe, the bank’s deputy governor and chief economist, spoke at the Ethiopia Finance Forum in late September.
The Reporter, an Addis Ababa newspaper, published his remarks in Amharic on Sunday 4 October. He said the dollars the bank auctions to lenders will not continue permanently, because the banking system has begun to stand on its own.
Fikadu said banks paid more than US$17 billion for imports and other purchases in the last fiscal year, excluding goods bought with importers’ own dollars. Central bank auctions supplied only 17% of that, roughly US$2.9 billion.
He said the bank’s future role would be temporary support for imports of basic goods. For now, he said, it supplies dollars only to ease short-term liquidity gaps at banks.
He added that the central bank would step into the market only to curb unnecessary swings in the rate and to strengthen supply.
How Demand at the Auctions Has Swung
Demand at the dollar auctions has moved sharply from one round to the next. At the 12 August auction, banks bid US$470.17 million for US$125 million, nearly four times the amount on offer, Capital reported.
On 20 August, the bank held a special US$500 million auction that drew US$710.14 million in bids. On 26 August, only five banks took part, bidding US$170.51 million, Capital later noted.
On 9 September, the 20 participating banks bid only US$120 million for the US$125 million offered, Capital wrote. It called this the first time banks had failed to absorb a full offer since results began to be published.
The weighted average rate at that auction was 160.5357 birr per dollar. Analysts quoted by Capital blamed a temporary shortage of birr at banks, not a fall in demand for dollars.
Demand fell short again on 23 September, when 27 banks bid US$123.49 million for US$125 million, Birr Metrics reported. The weighted average rate that day was 160.2297 birr per dollar.
The Birr Since the 2024 Float
Ethiopia ended its fixed exchange rate in July 2024, in a reform backed by the International Monetary Fund (IMF). The IMF is the Washington-based lender to governments in trouble, and the United States is its largest shareholder.
The IMF approved a 48-month Extended Credit Facility of about US$3.4 billion for Ethiopia on 29 July 2024. When it completed its fourth review in January, it said the central bank was limiting currency interventions to auctions.
The birr has fallen from about 57 per dollar before the float to around 160 in early October, Capital reported. The central bank’s indicative rate was about 161 birr to the US dollar on 7 October 2026.
A gap with the street remains, with parallel-market rates in Addis Ababa near 180 birr per dollar, according to Capital. Fikadu said that gap has narrowed sharply since the reform.
What It Means for US Readers
For US investors, bigger dollar auctions show a central bank with dollars to sell and a willingness to use them to calm the market. That matters for anyone holding Ethiopian debt or weighing a stake in its economy.
For US exporters and companies working in Ethiopia, more dollars at banks can mean shorter waits to pay suppliers and send profits home. The deputy governor’s message is that banks, not the central bank, must become the main source.
The dollar auctions are also part of Ethiopia’s bargain with the IMF. In January, the fund made it a binding programme target that the central bank intervenes in the currency market only through auctions.
What Is Not Known
The National Bank has not said when the Ethiopia dollar auctions will end, or what share of bank-sourced dollars would let it stop. Fikadu gave no date in the remarks The Reporter published.
It is also unclear why the bank chose US$140 million per round. Nor has it said whether rounds would shrink if bids fall short again, as they did on 9 and 23 September.
The bank has also not said how much auction money will go to imports of basic goods, the role Fikadu sees for it.
More: Ethiopia news in English, every day from The Rio Times.
Frequently Asked Questions
What are Ethiopia’s dollar auctions?
They are sales in which the National Bank of Ethiopia offers a fixed amount of US dollars to commercial banks, which bid in birr. The results show the price banks are willing to pay for dollars.
How much will Ethiopia auction this quarter?
US$840 million in six rounds of US$140 million each, from 13 October to 22 December, according to Birr Metrics and Capital. That is 68% more than the US$500 million offered in last quarter’s four regular rounds.
Will the Ethiopia dollar auctions continue?
Deputy Governor Fikadu Digafe said in late September that they will not continue permanently. He expects banks to supply most dollars themselves, with the central bank giving temporary support for basic goods.
What is the birr exchange rate now?
The central bank’s indicative rate was about 161 birr to the US dollar on 7 October 2026. Capital reports parallel-market rates near 180 birr per dollar in Addis Ababa.
Why does this matter for US investors?
Ethiopia’s IMF-backed reform depends on a working currency market. Easier access to dollars helps importers, foreign investors and the country’s foreign creditors.
Sources: Birr Metrics, 6 October 2026; Capital (Addis Ababa), 6 October 2026; The Reporter (Amharic), 4 October 2026; Birr Metrics, 23 September auction results, 23 September 2026; Capital (Addis Ababa), 13 September 2026; National Bank of Ethiopia, indicative daily exchange rate, 7 October 2026; National Bank of Ethiopia, Ethiopia Finance Forum 2026 (Telegram), 30 September 2026; International Monetary Fund, fourth ECF review, 16 January 2026.
This article was produced by The Rio Times’ automated newsroom system. How we use AI · Report an error · Editorial responsibility: Matthias Camenzind, Editor-in-Chief
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