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Governor Mamo Ditches Bond Mandate Betting Aid, Exports Will Tame Inflation

Jun 27 , 2025

The Central Bank plans to lift a rule that forces banks and pension funds to buy government bonds, Governor Mamo Miheretu disclosed.

The National Monetary Policy Committee is expected to scrap the requirement after it meets on Monday, he told lawmakers while presenting the National Bank of Ethiopia’s (NBE) 11-month report.

Over the past three quarters, banks and pension funds bought 66.8 billion Birr of treasury bonds, while deposits climbed to 161.3 billion Br.

Mamo also disclosed that country should receive 750 million dollars in aid by the end of this month; half a billion dollars from the World Bank and the rest from the International Monetary Fund(IMF) as part of a third-round disbursement. An additional one billion dollars in foreign support is expected in the next budget year.

The Governor pointed to “considerable changes” in financial-sector reforms over the reported year. Foreign exchange earnings are projected at 32.1 billion dollars, up from 24 billion dollars a year earlier. Two bilateral loans worth 8.5 billion dollars have been postponed, easing short-term pressure after other loans were deferred for 14 years.

Inflation has cooled to 14.4pc in May this year, with food inflation down to 12pc. Non-food inflation remains higher at 17.8pc.

“We want it at single digit,” Mamo told federal legislators today of the Central Bank’s target for the coming year.

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