IMF Warns Ethiopia’s Economic Growth Faces Inflation and Current Account Deficit Pressures

The International Monetary Fund (IMF) has cautioned that Ethiopia’s strong economic growth outlook may encounter obstacles due to persistent inflation and a widening current account deficit, as highlighted in its October 2026 World Economic Outlook report. The IMF projects Ethiopia’s real gross domestic product (GDP) to grow by 9.2 percent in 2026, aligning with the estimated growth rate for 2025.

Despite this positive growth trajectory, consumer price inflation in Ethiopia reached 16 percent in 2025, according to the IMF report. The report notes that while inflation is expected to decline in 2026, the rate would remain elevated, potentially straining household purchasing power and business operations.