Ethiopia’s financial system remained stable and resilient during the 2024/25 fiscal year, supported by improving macroeconomic conditions despite a challenging global environment, according to a new report by the National Bank of Ethiopia.
The central bank’s third Financial Stability Report, covering the period from July 2024 to June 2025, provides a comprehensive assessment of risks, vulnerabilities and sector performance, offering insights for policymakers, investors and other stakeholders.
The report indicates that the review period was marked by external headwinds, including slower global growth and broader uncertainties. Nevertheless, Ethiopia recorded notable macroeconomic improvements, with stronger economic growth and declining inflation contributing to a more stable environment for financial institutions. These developments also supported the transition to positive real interest rates and improved the effectiveness of monetary policy.
Fiscal performance also strengthened during the period, with lower budget deficits and more sustainable public and domestic debt levels helping to ease macroeconomic pressures and reinforce financial stability.
