Ethiopia policy rate

How to read it

• The policy rate is the rate the National Bank of Ethiopia uses to signal its stance. The NBE also calls it the National Bank Rate (NBR). The NBE describes it as the key signal of how tight or loose monetary policy is.
• It is not the rate on your loan. It works through short-term market rates, then through what banks pay for deposits and charge on loans. Each step takes time.
• The band is a range either side of the policy rate. Its edges are the NBE’s two standing facilities: banks can deposit spare cash at the lower rate and borrow overnight at the upper rate.
• The mechanism is still young. In December 2025 the NBE said its policy rate had yet to develop a strong transmission mechanism.
• Comparing it with inflation shows whether the rate is above or below the pace of price rises. The chart puts the two on one scale.

Method

• Each row is one meeting of the Monetary Policy Committee, read from the NBE press release for that meeting.
• The date is the date on the press release. The meeting itself can be a few days earlier.
• The committee proposes and the NBE Board approves. The releases describe decisions in both ways.
• The releases for meetings No. 6 and No. 7 do not state the level. No. 6 kept the rate “at current levels”, which was 15% after No. 5. No. 7 raised it “by 1.0 percentage point”, to 16%. The release for No. 8 confirms 16%.
• The series starts at meeting No. 2. The press release for meeting No. 1 is not in the series yet. The NBE has used a policy rate since July 2024.
• The band is shown only for meetings whose release states it.
• In the chart, the policy rate for a month is the rate in force at the end of that month.