Ethiopia Inflation Rate Slows to 5-Month Low

The annual inflation rate in Ethiopia ticked down to 9.7% in February 2026 from 9.8% in the prior month. Price growth eased for non-food products (8.1% vs 9% in January) but accelerated for food (10.8% vs 10.4%). On a monthly basis, consumer prices rose by 0.4% in February, following a 0.7% increase in the prior month. Headline inflation fell into single digits for the first time in many years in December 2025. Prime Minister Abiy Ahmed recently said that targeted subsidies, income adjustments, supply-chain reforms, and improvements in essential public services such as electricity and water helped achieve this milestone.

The annual inflation rate in Ethiopia eased further to 10.9% in November 2025, the lowest since February 2019, from 11.7% in the prior month, despite persistent currency pressures. This marked the sixth consecutive month of slowing inflation, mainly due to non-food products (11.4% vs 14.2%). On the other hand, food inflation accelerated (10.6% vs 10.2%), on higher prices of vegetables, meat, sugar and sweets, dairy products, fruits, oils and fats, and other food items. On a monthly basis, consumer prices decreased by 1.4% in November, after a 2.3% rise in the previous month. Meanwhile, the local currency remains under pressure due to persistent foreign exchange shortages. The shift to a market-based FX mechanism in July 2024 aligned official rates with parallel-market levels, triggering sharp swings in the birr.

The annual inflation rate in Ethiopia fell to 10.7% in October 2025, the softest since March 2019, from 13.2% in the prior month. This marked the fifth consecutive month of slowing inflation, helped by both food (10.2% vs 12.1% in September) and non-food products (14.2% vs 14.8%). On a monthly basis, the CPI rose by 2.3% in October, after a 2% advance in the previous month.