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Ethiopia: Year−on−year inflation hits 22.9 percent

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Ethiopia’s year−to−year inflation has hit 22.9 percent in April 2020, the highest since 2012, with price increases continuing to be broad−based, according to the Ethiopian Central Statistics Agency.

The price of food has increased by 25.9 percent as non−food items rose by 19.2 percent. The index for cereals and bread expanded by 31.2 percent in the last 12 months, placing a disproportionate burden on the poor households that depend on these items for their primary sources of energy, the agency said on Tuesday, 2 June 2020 in a statement.

The prices of staple cereals are far higher than the previous year and five−year averages for the same month. For example, the average prices of maize, teff, and sorghum stood at 32 percent, 52 percent, and 29 percent, respectively, above the corresponding prices a year ago.

The prices of these cereals recorded historic highs during April. Retail prices of teff, which had recorded atypical increases between December 2019 and March 2020, increased firmly again in April 2020.

Supply shortages and price increases of key staples (such as maize and sorghum) experienced in March as a result of travel restrictions and panic buying in response to the onset of Covid−19, tended to stabilize in April in most of the monitored markets. However, scarcity of teff and wheat was reported in many monitored markets.

Given that the galloping inflation rate is caused by the expansion in both food and non−food indices, the increase in cereal prices stems from macro factors in the economy of the country.

The prices of wheat flour firmly increased from March, overlapping with the onset of Covid−19 cases in Ethiopia and the introduction of stricter measures by the Government to control the spread of the virus.

The price trend in April remained stable, increasing only slightly. March and April saw abrupt spikes in the price of rice, echoing the recent upward trend in the international market.

The average retail price of sorghum in monitored Somali Region markets stood at 16 percent above the average price in April 2019 and 57 percent above the five−year average price for the month.

– APA

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