The local currency is the Ethiopian Birr. At 6/7/12, €1 = 22 Birr and £1 = 27 Birr. The price of these currencies is updated weekly. The most recent price can be found at www.oanda.com.
For this trip you can bring with you the recommended allowance in cash. US Dollars are preferred but other currencies such as Euros are becoming more widely accepted, though not all banks will take them. Changing money is possible at the airport, at banks in Addis Ababa and at some hotels. ATM withdrawals in Ethiopia are almost impossible. Credit and debit cards are not of much use on this trip-only expensive hotels in the capital will accept them.
It is convenient to keep your money and valuables in a plastic bag inside a cotton money belt. This gives good protection against perspiration and possible rain. As you will be carrying a lot of cash, an appropriate insurance is worthwhile.