Source: Business Info Ethiopia

Addis Ababa, Ethiopia 9 (10 February 2023)

Ethiopia is currently experiencing a high rate of inflation, with an average of 34% in 2022, which was previously at an average of 27% in 2021. The latest data from December 2022 shows a year-on-year inflation rate of 33.8%, which is slightly better than the high of 37.2% in May 2022.

Despite the 1.1% average monthly price increase in Q4 2022, it remains uncertain if this trend will lead to a positive outlook for the country’s inflation rate, as previous decreases in monthly inflation have proven to be short-lived in the past two years.

While food inflation has been moderating, with a decline of 10 percentage points since early 2022 and negative month-on-month inflation rates in two of the past three months, non-food inflation is becoming a major contributor to the overall inflation rate. Prices for non-food items, including fuel, transport, alcoholic beverages, furnishings, and housing, have jumped significantly, contributing to a 35% year-on-year increase.

Administrative measures, such as recent fuel price increases, excise/tariff adjustments, and import bans on selected consumer goods, seem to be playing a significant role in recent monthly inflation. This may explain why non-food inflation has now exceeded food inflation over the past three months.

Despite this, global food price measures, such as the FAO food price index, remain around 20% below their 2022 peaks, suggesting that food prices are yet to show any significant declines in Ethiopia.

Source: Cepheus Capital


The opinions expresses here in the post "Food Inflation Eases, Non-Food Inflation Intensifies in Ethiopia's Inflation Struggle" are those of the individua's contributor(s) and do not necessarily reflect the views of Business Info Ethiopia , BIE Intelligence PLC, its publisher, editor, or any of its other contributors.


Hanna is an aspiring economist in her final year at Addis Ababa University. She has written hundreds of insightful daily stories, analyses, and features about the Ethiopian economy and beyond.

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