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Commercial Bank of Ethiopia, August 9

NBE Concludes Special FX Auction The National Bank of Ethiopia (NBE) has announced the results of a Special Foreign Exchange Auction held today, August 7th, 2024. The weighted average rate was Birr 107.9 per US Dollar. NBE Governor Mamo Mihretu expressed satisfaction with the narrowing gap between bank exchange rates and parallel market rates and progress towards exchange rate stability.

National Bank of Ethiopia to Conduct Special Foreign Exchange Auction

Ethiopia Announces Special Foreign Exchange Auction: What You Need to Know The National Bank of Ethiopia (NBE) has announced a special foreign exchange auction to be held on August 7, 2024. This move comes amid a recent floatation of the Ethiopian Birr (ETB) and aims to increase access to foreign currency for authorized banks. What is a Special Foreign Exchange Auction? In a special forex auction, the NBE makes a specific amount of foreign currency, typically US Dollars (USD), available for purchase by authorized banks operating in Ethiopia. Banks submit bids indicating the amount of USD they want to buy and the exchange rate they are willing to pay (expressed as Birr per USD). The NBE then allocates the USD based on these bids, with successful banks receiving USD at the exchange rate they offered. Why is the NBE Holding a Special Auction? The recent floatation of the Birr may have caused some temporary strain on the availability of foreign currency for authorized banks. This special auction can help alleviate that pressure by providing a designated channel for banks to access USD. Additionally, the NBE might be using the auction to gauge market demand for foreign currency and assess the effectiveness of the Birr floatation. What This Means for Businesses and Individuals The impact of this special auction on businesses and individuals will depend on several factors, including the volume of USD made available by the NBE and the exchange rate discovered through the bidding process. It's important to note that this auction is for authorized banks only and will not directly affect the exchange rate available to the general public. However, this event does signal a shift in Ethiopia's foreign exchange policy. The Birr floatation and this special auction are both indications of a move towards a more market-driven foreign exchange system. In the long run, this could lead to increased transparency and potentially more stability in the exchange rate. Stay Informed with exBirr.com The foreign exchange market can be complex, especially during times of transition. To stay up-to-date on the latest Birr exchange rates and understand how these developments might impact your business or personal finances, visit exBirr.com. This website provides real-time forex information and valuable insights into the Ethiopian foreign exchange market. Join the Discussion Ethiopia's economic reforms are a topic of significant interest. What are your thoughts on the NBE's decision to hold a special foreign exchange auction? Share your comments and insights in the section below.

The International Monetary Fund (IMF) projects that government spending in this budget year will be twice as high as the amount approved last month, totaling 1.8 trillion birr. https://lnkd.in/dUxapXaK

JAPAN FACES ECONOMIC CRISIS AS YEN CARRY TRADE COLLAPSE LOOMS Japan's economy faces a crisis due to the potential collapse of its $20 trillion yen carry trade amid rising inflation. The Bank of Japan (BoJ) is caught between tightening monetary policies, risking a collapse of the carry trade, or maintaining low rates, which threatens financial stability. This situation affects wealth distribution, impacting older, wealthier citizens if policies tighten and younger households if rates remain low. The BoJ's decision will shape Japan's economic future, risking financial instability and yen devaluation. Source: ZeroHedge

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