Monthly Market Insights - February 2024

Throughout this month, the Ethiopian Birr experienced a period of consolidation following the volatility observed in previous quarters. The market mid-point has stabilized around current levels, supported by strategic interventions and a gradual increase in foreign currency inflows from major export sectors. Analysts have noted that the liquidity constraints in the private banking sector are beginning to ease slightly, though demand for USD remains high for essential imports.

While commercial rates at Awash Bank and CBE remain relatively steady, the gap between official and parallel market rates has shown signs of narrowing by approximately 2.5% compared to January. This shift is largely attributed to revised monetary policies aimed at harmonizing exchange rate mechanisms. Experts suggest monitoring the next 24 hours for potential resistance levels near 159.00 ETB, as seasonal fluctuations typically begin to manifest towards the end of the fiscal quarter.