ADDIS ABABA, Feb 24 (Reuters) – Ethiopia’s central bank said on Monday it was conducting a foreign exchange auction for $60 million, with the sale open to all banks.

In July 2024, Ethiopia’s central bank removed restrictions on the foreign currency market, a crucial step towards securing funding from the International Monetary Fund and making progress on a long-delayed debt overhaul.

The National Bank of Ethiopia said the auction was being held to offset what could become excessive money supply growth.

In December 2023, Ethiopia which is struggling with high inflation and chronic foreign currency shortages, became the third economy on the African continent in as many years to default on its debt.

(Reporting by Dawit Endeshaw; Writing by George Obulutsa; Editing by Andrew Cawthorne and Susan Fenton)