Sudan inflation surges to 12.94% in February

Sudan’s annual inflation rate climbed to 12.94 percent in February from 12.44 percent in January, a monthly report from Sudan’s Central Statistics Office announced Tuesday.

Prices soared in Sudan after South Sudan seceded in 2011, taking with it three-quarters of the country’s oil output, the main source of foreign currency used to support the Sudanese pound and to pay for food and other imports.

Cuts in fuel subsidies introduced in 2013 pushed up inflation, but those effects have since begun to ease.

In December, the Sudanese pound fell to 11.6 pounds to the dollar, its lowest rate on the parallel market since 2011, currency traders said, as the official banking system struggled to supply the dollars needed to buy imports.

The official rate is still 6.4 Sudanese pounds to the dollar, but the greenback was valued at 12 Sudanese pounds on Tuesday.

Sudan expects a budget deficit of 1.6 percent of gross domestic product for the coming year, up from 1.2 percent for 2015.

The government said in December it expected growth to increase in the coming year as lower oil prices reduce its import bill. It projects a growth rate of 6.4 percent this year, up from 5.3 percent in 2015.

Source: Reuters