ADDIS ABABA, Ethiopia (AP) — Ethiopia’s currency lost 30% of its value Tuesday, the day after the central bank began implementing a flexible exchange rate policy backed by the International Monetary Fund as part of new measures to stabilize the eastern African nation’s economy. Following the currency float, the birr depreciated by 30% in the official market against major foreign currencies. Ethiopia has long faced a critical shortage of foreign currency. For over a year, the gap between the official exchange rate and the parallel market rate soared, a disparity the government expects to narrow after the reforms. “The floating was overdue as the parallel black market had reached its ceiling due to cash shortages in the economy,” said Samson Berhane, an economist based in Addis Ababa.

Source: Ethiopian News July 30, 2024 15:00 UTC