February 6, 2012 / 9:03 AM / 8 years ago

South Sudan inflation eases to 47.8 pct in January

JUBA, Feb 6 (Reuters) - South Sudan’s annual inflation rate eased to 47.8 percent in January from 65.6 pct in December as costs for some food items fell, official data showed on Monday.

South Sudan became independent on July 9 under a 2005 peace agreement with its former civil war foe, Khartoum, but has been struggling to tackle an economic crisis and contain tribal and rebel violence which killed thousands last year.

Analysts say inflation could rise in the months ahead after landlocked South Sudan shut down its oil production last month to protest against seizures of its oil by Sudan through which it needs to export its crude.

Oil makes up 98 percent of state revenues in one of the world’s least developed countries. Annual inflation had hit 78.8 percent in November.

Month-on-month inflation rose 0.1 percent in January compared to a decline of 0.7 percent in December, the National Bureau of Statistics said in its monthly bulletin.

Costs for food and non-alcoholic beverages rose by 40.6 percent in January compared to 57.4 percent in December, the data showed. But the cost for household goods rose by 111 percent in January compared to 99.9 percent in December.

The United Nations has warned the underdeveloped new nation faces severe food shortages this year because it will produce less than half what is needed in 2011 due to heavy rain and widespread violence.

Violence on both sides of the joint border has hampered trade with Sudan, from where much of the South’s needs come, especially food supplies to northern regions. (Reporting by Ulf Laessing; editing by Patrick Graham)

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