Algeria’s annual inflation fell in January to 5.2 percent from 5.6 percent the previous month due to lower prices for some vegetables, official data showed on Monday. However, concerns over the Algerian economy still exist.
Algeria has been trying to boost domestic food output while restricting imports in a bid to cut spending after a fall in energy earnings.
On a monthly basis, the consumer price index declined 0.9 percent in January, according to the National Statistics Bureau. The cost of vegetables fell 8 percent, while prices for cheeses and dried fruits rose 1.4 percent and 2 percent respectively.
Mid-Feb, Central Bank Governor Mohamed Loukal attributed the rise of inflation in 2017 (up to 5.6 percent) to the weak competition, organization and surveillance over many services and goods markets. Loukal warned that the decline in the country's reserves of foreign currency would reduce resistance in face of foreign shocks.
Foreign reserves in Algeria dropped in 2017 around $16.8 billion, reaching only $97.3 billion at the end of the year compared to $114.1 billion at the end of 2016.
Algerian Finance Minister Abdel Rahman Rawi expected in October the foreign exchange reserves to reach $85.2 billion end of 2018.
At the beginning of February, Algerian Minister of Industry and Small and Medium Enterprises Mohamed Bin Moradi warned the government that Algeria would go bankrupt within two to three years unless urgent procedures were taken. His statements went in tandem with similar statements made by Algerian Prime Minister Ahmed Ouyahia who affirmed that the country is undergoing a serious financial crisis and that his government took measures to overcome the economic crisis which is considered the hardest in this history of Algeria.
