Ethiopia’s June inflation dips to 7.3 pct

Ethiopia
Ethiopia

ADDIS ABABA (Reuters) – Ethiopia’s year-on-year inflation rate slowed slightly to 7.3 percent in June from 7.4 percent in May, although food prices continued to rise, its statistics office said on Thursday.

“In recent months, except for cereals, almost all the other food components have shown a rise in their indices,” the Central Statistical Agency said in a statement.

“Especially, the index of pepper and spices has shown a rising trend. In regard to non-food components, the majority of them showed an increasing trend.”

Ethiopia was beset by soaring inflation in 2008 and much of 2009, driven by record food and fuel prices. The rate plummeted from July 2009 to October 2009 after the government stopped state borrowing and increased bank reserves.

The IMF said last month that the Horn of Africa country had been successful in implementing policies to curb inflation and rebuild external reserves as agreed under an Exogenous Shocks Facility-supported programme.

Ethiopia, keen to attract foreign investment in agriculture and mineral exploration, this month passed a $5.7 billion budget that targets infrastructure development to maintain annual growth rates of about 10 percent.