By Ed Harris

PORT LOUIS (Reuters) - Annual inflation in Mauritius fell to 8.9 percent in January from 9.1 percent a year before, the Central Statistics Office (CSO) said on Friday, but the rate rose marginally from 8.8 percent in December.

"The rate of inflation for the twelve months ending January 2008 works out to 8.9 percent compared to 9.1 percent for the same period ending January 2007," the CSO statement said.

Inflation in 2007 was 8.8 percent, causing hardship for many Mauritians.

Analysts from Mauritius' largest bank, the Mauritius Commercial Bank (MCB) earlier this week said they expected inflation to stay high.

"Inflation, despite its declining trend, would remain relatively high at projected rates of 8.3 percent and 7.8 percent as at next June and December," an MCB report said, citing rising food and energy prices on world markets.

Mauritius' appreciating rupee puts downward pressure on inflation, the report said.

Other analysts said they thought the MCB inflation estimate was a bit high.

"I think the rupee will keep appreciating in the coming months," said Eric Ng, director of Pluri Conseil, an economic consultancy.

"This appreciation should trickle down. My instinct is that it (inflation) should go down below 8 percent by June," he said.

Mauritius' government expects the roughly $7 billion economy to grow 6.0 percent this year, up from 5.6 percent in 2007.

Since beginning economic reforms in 2006, Mauritius has been ranked by the World Bank and other agencies as Africa's top country for economic freedom, ease of doing business and good governance.