Ethiopia’s domestic debt market recorded strong demand in July and August 2025, with total government issuance reaching ETB 111.1 billion, surpassing the planned ETB 103.4 billion, the Ministry of Finance said in its first Monthly Domestic Debt Bulletin.

The auction drew bids worth ETB 164.7 billion, or 159 percent of the offering, resulting in a net issuance of ETB 23.9 billion, equivalent to 14 percent of the government’s annual borrowing target. Investor appetite was concentrated in short-term treasury bills, particularly the 28- and 91-day tenors, signalling continued confidence in the market.

Commercial banks and pension funds held nearly 80 percent of outstanding T-bills, while the entry of Ethiopian Investment Holdings expanded the investor base. Analysts view these developments as a reflection of the authorities’ push to modernise public finance, including the introduction of a three-month issuance calendar and the creation of a secondary market to enhance liquidity.

The bulletin also coincides with a 31 percent increase in the 2025/26 national budget, highlighting the growing reliance on domestic borrowing to fund government spending while limiting pressure on monetary financing.