Reported 3 months ago
Ethiopia's currency, the birr, fell by 30% within a day following the central bank's introduction of a flexible exchange rate policy backed by the International Monetary Fund, aimed at stabilizing the economy. The reforms permit commercial banks to set foreign exchange rates, a significant shift from decades of government control. While the IMF approved a $3.4 billion credit facility, the immediate consequence was a sharp rise in inflation, raising concerns about the cost of living for many citizens, particularly the urban poor and pensioners. The government is pledging subsidies and salary increases to help mitigate the impact of these changes.
Source: YAHOO