Radar | May 10,2026
Jun 30 , 2025
The National Bank of Ethiopia’s.(NBE) Monetary Policy Committee (MPC) stopped asking commercial banks to buy treasury bonds, signalling a shift toward market-based debt financing.
At its third meeting held today, the Committee also decided to keep the policy interest rate steady at 15pc, maintaining a tight monetary policy, trying to ease the still elevated inflation levels.
Short-term interest rates have consistently stayed above the Central Bank’s policy rate. For instance, by the end of May 2025, the 91-day Treasury bill rate reached 17.7pc, while the average seven-day interbank lending rate stood at 17.5pc. Interbank transaction volumes expanded since, totalling 740.2 billion Br.
The Committee said it determined the banking system as stable, citing low non-performing loan ratios and adequate capital buffers. However, some private banks continue to face liquidity pressures, reflected in elevated loan-to-deposit ratios.
Among other decisions, the Committee maintained the current 18pc annual ceiling on credit growth until the next meeting, scheduled for late September 2025. The standing deposit and lending facility rates, along with the reserve requirement ratio for commercial banks, will also remain unchanged.
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