Ethiopia inflation jumps after currency devaluation

Ethiopia's annual inflation rate jumped to 14.5 percent last month from 10.2 percent in November following an almost 17 percent devaluation of its currency last year.

The Central Statistics Agency (CSA) said on Friday non-food inflation rose to 22.9 percent in December from 16.7 percent the month before. Food prices rose 8.9 percent from 5.8 percent previously, the agency said.

After soaring in 2008 and early 2009, the rate of inflation plummeted in late 2009 after the government stopped state borrowing and increased bank reserves.

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

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