Ethiopia inflation rises to 10.6 pct in October: agency – ADDIS ABABA (Reuters)

November 15th, 2010 Print Print Email Email

Ethiopia’s annual inflation rate rose to 10.6 percent in October from 7.5 percent in September on rising prices of food and imported goods, the statistics office said on Monday.

The Central Statistical Agency (CSA) said the overall food price index in Africa’s second most populous nation increased 5.4 percent in October, with all food components except cereals rising.

Ethiopians are watching for the effects of the birr currency’s devaluation in September on inflation, which rose to record levels in 2008 and 2009 on the back of global food and fuel prices.

The CSA said non-food inflation rose by 18.7 percent, with imported goods like cigarettes, construction materials and clothing showing big increases.

“Cigarettes and tobacco increased by 33.9 percent, clothing and footwear by 25.1 percent, house rent, construction material, fuel and power by 16.5 percent,” the CSA said in a statement.

The Horn of Africa nation devalued the birr by 16.7 percent in September and targets annual inflation of 6 percent over the next five years.

After the high rates of inflation in 2008 and 2009, the rate plummeted from July 2009 to October 2009 after the government stopped state borrowing and increased bank reserves.

Analysts say there is a risk inflation will continue to rise after the devaluation.

  1. Andinet Godana
    | #1

    When the TPLF Govt boasts about the GDP being 11%,(a higher annual growth rate) than any nation on the planet, many thinks these would alleviates the food price crisis at least for some time. But reality tells otherwise. The familiar day today pocket politics of Woyane madness clearly has shown its true color by inflating and manipulating the rate of the consumer price index (CPI)to its highest rate of up to 300% from the past years.

    In a country where the average annual income is only about $400.00,
    where a loaf of bread,sugar,milk,..etc. 100 times higher than they used to be before the TPLF junta GOVT, it is now clear and presently dangerous the head of TPLF and co. up to self enriching and self full
    filling their own interest. I sure hope these (economics) madness only brings unrest, anarchy, and the worst.

  2. Getayawqal
    | #2

    Woyane is killing the people. They have money that they looted from teh people and it is only the poor people who will suffer from the inflation. They are really very cruel. God Bless Ethiopia

  3. idiot dictator
    | #3

    This writer is making an assumption that the devaluation is on the back of global food and fuel prices. It is wrong. The birr is devalued by the government to control internal and external forces (the ethiopian people’s activity). Since when do you determine a 3rd world currency due to economical effects? 3rd worlds can not even measure their gdp right,let alone determine the valuation of their resources and currencies. Foreign and Ethiopian gov. used to determine the exchange rate for the birr in the past because Ethiopia is not capable or effecient enough to quantamize the financial system.

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