The Central Statistical Agency said this week that Ethiopia’s inflation rate climbed to 39.2 percent in July from a year earlier.

Inflation accelerated from 38.1 percent in June, according to the agency. Food prices increased by 47.4 percent in July after rising 45.3 percent in the previous month, while the cost of non-food items fell from 27.9 percent to 27.8 percent, it said.

In May the annual rate of inflation in Ethiopia had risen to 34.7 percent from 25.6 percent in April as food prices climbed, according to the agency. Food prices had increased by 41 percent in the year, compared with a 32.2 percent increase in April, the agency said.

The IMF had said in June that one of the major causes of inflation in Ethiopia was "excessive" growth in the supply of money, which expanded 35 percent at the end of March.

Food prices rose to 45.3 percent in June after rising 40.7 percent in the May, according to the agency.

According to Mitiku Kassa, Minister of State for Agriculture, food prices in east Africa have gone up due to drought in the region. And Prime Minister Meles Zenawi had said on July 5 that money supply growth of as much as 40 percent had played a “significant role” in driving prices.

Source: Bloomberg