UPDATE 1-Ethiopia annual inflation falls to 32.8 pct in Feb

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ADDIS ABABA, March 23 (Reuters) - Ethiopia's annual inflation rate fell to 32.8 percent in February compared with 37.8 percent in January, the government said on Monday.

The Horn of Africa nation's annual rate hit a high of 61.7 percent in August 2008, spurred by high food and fuel prices. But in February, Prime Minister Meles Zenawi forecast a return to single-digit inflation by June or July.

"As of February 2009, data showed that overall inflation ... has sharply dropped to 32.8 percent following various fiscal and administrative measures taken by the government," the state-run Central Statistical Office (CSO) said in a statement.

It said food price inflation, which had reached 92 percent last year, had dropped to 39 percent after the authorities imported 800,000 tonnes of wheat to stabilise the market.

The global decline in crude oil prices had also helped by mitigating transport costs, the statement said.

Africa's biggest coffee producer has benefited from programmes to boost agricultural output and diversify its economic base, but still remains one of the world's poorest, ranking 170 out of 177 on the U.N. Human Development Index.

Last month, Meles reiterated the official forecast that Ethiopia's mainly farm-based economy will grow by 11.2 percent in 2009, up from 10 percent last year. [ID:nL0644202] (Reporting by Tsegaye Tadesse; Editing by Daniel Wallis and Toby Chopra)