The National Bank of Ethiopia (NBE) has marked the first anniversary of its Open Market Operations (OMO) auctions, reporting a record trade of Birr 579.4 billion over the past year.
Introduced in early July last year under a new monetary policy framework, the biweekly auctions have become a key tool for managing liquidity and controlling inflation, offering a National Bank Rate (NBR) of 15% with a two-week maturity period.
Since launch, the NBE has focused on absorbing excess liquidity rather than injecting funds, holding 26 auctions with an average of five bidders each. Participation peaked during the July 25, 2024 auction, which drew 21 banks and allotted Birr 37.5 billion, while the largest single allotment, Birr 45.25 billion, occurred on March 20. The most recent auction on July 10, 2025, saw a record Birr 64.9 billion traded among 13 banks.
Experts note OMOs help stabilize interbank rates and guide credit conditions. To complement these operations, the NBE has also introduced Overnight Lending and Deposit Facilities, offering liquidity at the NBR rate plus or minus 3%. To date, Birr 834 billion has been traded through these new facilities, underscoring the NBE’s evolving approach to monetary management.
Source: Capital Ethiopia