The year on year inflation rate in Ethiopia rose to 36.3% in February from 32% in January according to official statistics revealed yesterday.
As compared to the same month last year, food prices showed an increase of 47.4% while non food inflation showed an increase of 21.4%.
The main increase in food prices was seen in the prices of fruits and vegetables, cereals, pulses and spices according to the official agency.
Month on month consumer prices as seen against that of January showed a 2.7% increase from just 0.6% in January.The inflation rate for the month of January had dropped from 35.9% in December following the drop in annual food inflation to 41.4% from 46.7% in December according to a report from the Central Statistical Agency.
It is to be remembered that the Ethiopian government’s plan to reduce inflation to single digits came under criticism from the international financial institutes.
The international Monetary Fund had predicted on 31 May 2011 that inflation might undermine economic growth in Ethiopia. IMF had said that the economy would fall from 7.5 percent this year to 6 percent in the 2011/2012 fiscal year and that the country's monetary policy was pushing up inflation which, combined with restrictions on bank lending, would in turn bring about a slower economic growth.
The inflation is something that the Ethiopian government has taken into consideration and is working towards alleviating says Meles Zenawi Prime Minister of Ethiopia. The high rates of inflation were caused by multiple challenges including the effects of the global market he explained.
Source: Reuters
