We mentioned a couple of weeks ago that inflation has taken off in Ethiopia, this week we are looking at this in a little more detail. Having hovered between 18 and 20% over the previous 12 months, in June inflation started to accelerate to reach over 30% in August, the highest inflation rate in over 10 years. The main component of the Inflation Rate is the price of food with a weight of 54%, and this element has increased by 38% in August!
This is a direct consequence of lack of supply; mainly of foodstuffs caused by the debilitating fighting within Ethiopia. We discussed in an earlier post the measures taken to try to halt this steady rise in prices starting with cancelling import duties on basic goods. However, with fighting spreading to Amhara and Afar the food security situation is not improving.
On the coffee front sporadic offers and buying interest keeps popping up here and there. The logistics continue to be a struggle and we feel that the volume of business has slowed down a tad.
Birr 46.02= USD 1
Have a good weekend.