Exchange Rate Ethiopian Birr To Us Dollar Black Market
Exchange rates determine the value of one currency against another. It is essential to keep track of exchange rates while traveling or doing business internationally. One such currency that has been in the news lately is the Ethiopian Birr. In this article, we will discuss the exchange rate of the Ethiopian Birr to the US dollar in the black market.
What is the Ethiopian Birr?
The Ethiopian Birr is the official currency of Ethiopia, a country located in the Horn of Africa. The currency is abbreviated as ETB and is issued by the National Bank of Ethiopia. One Ethiopian Birr is divided into 100 cents. The currency is available in both coins and banknotes. The banknotes are available in denominations of 1, 5, 10, 50, and 100 Birr.
What is the US Dollar?
The US dollar is the official currency of the United States of America. It is abbreviated as USD and is the most widely used currency in the world. The US dollar is issued by the Federal Reserve System and is available in both coins and banknotes. The banknotes are available in denominations of 1, 5, 10, 20, 50, and 100 dollars.
Exchange Rate of Ethiopian Birr to US Dollar in the Black Market
The black market is an illegal market where goods and services are sold at prices higher than the official market rate. In the case of currency exchange, the black market rate is higher than the official exchange rate. The exchange rate of the Ethiopian Birr to the US dollar in the black market is determined by the demand and supply of the currency. It fluctuates daily and can be influenced by various factors such as political instability, economic conditions, and inflation.
Reasons for the High Exchange Rate of Ethiopian Birr to US Dollar in the Black Market
There are several reasons why the exchange rate of the Ethiopian Birr to the US dollar is high in the black market. One of the main reasons is the economic situation in Ethiopia. Ethiopia is one of the poorest countries in the world, with a high poverty rate. The country heavily relies on foreign aid and has a large trade deficit. This has led to a shortage of foreign currency in the country, making it difficult for people to access US dollars through official channels.
Another reason is the political instability in Ethiopia. The country has been facing political unrest, with protests and violence erupting in different parts of the country. This has led to a decline in foreign investment and a decrease in the inflow of foreign currency into the country.
Impact of High Exchange Rate on the Economy
The high exchange rate of the Ethiopian Birr to the US dollar in the black market has a significant impact on the economy. It makes imports expensive and reduces the purchasing power of the people. This, in turn, affects the price of goods and services, leading to inflation. The high inflation rate makes it difficult for the government to control the economy and can lead to a decline in economic growth.
Conclusion
The exchange rate of the Ethiopian Birr to the US dollar in the black market is high due to various factors such as economic conditions and political instability. It has a significant impact on the economy and the purchasing power of the people. It is essential to keep track of exchange rates while traveling or doing business internationally and to use official channels for currency exchange.