Inflation rate rises from 7.47% to 8.04%

Written By: Stanley Wabomba
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Inflation

The rate of inflation has marginally risen from 7.47 percent to 8.04 percent, driven by an increase in the cost of energy and the price of some food items.

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This means the rate of inflation has again breached the government’s medium term target of 7.5 percent.

Data from the Kenya National Bureau of Statistics shows that during the month, there was a sharp increase in the cost of tomatoes and electricity.

The rate of inflation had stayed outside the government’s higher medium term target band of 2.5 to 7.5 percent between February and June this year but lower cost of foodstuffs drove it lower last month.

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Things are however different this month as a higher cost of some food items such as tomatoes, electricity, spinach, carrots, wheat flour, rice, Irish potatoes, kerosene and diesel pushed up the rate of inflation from last month’s figure of 7.47 percent to the current 8.04 percent.

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During this month, there were notable price reductions of items such as maize grain as well as lower price of petrol, maize flour, milk, beans and beef.

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However, the price reductions were not big enough to off-set increases of other items in the surveyed basket leading to a higher rate of inflation.

The latest data from  KNBS indicates that food inflation this month rose to 13.57 percent, up from 12.19 percent last month due to depressed supply of food items in the second week of August.

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The mid-month upward review of kerosene and diesel by the Energy Regulatory Commission as well as higher cost of electricity led to a marginal increase in both the transport index as well as the Housing, Water, Electricity, Gas and other fuels index.

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