July inflation rate rises to 8.3pc on costly food items

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Kenya’s inflation rate  in the month on July has risen to the highest levels since 2017 touching 8.3pc from 7.9pc recorded in June.

Kenya National Bureau of Statistics (KNBS) says the increase was due to a rise in food and nonalcoholic beverages index which surged 15.3pc in a year to the period under review.

Retail prices for key food items have shot up sharply according latest data by KNBS.

According to the bureau, carrots, loose maize grain and non-aromatic white rice has their prices rise by 13pc, 9.7pc and 4.2pc respectively.

Price increment were also noted on beans, green grams, sukuma wiki, beef, and cabbages.

However, on a year-on-year basis, Kenyans have had to pay more for key food items, fuel and electricity.

For instance, retail prices for wheat flour, maize flour and cooking oil have rise 46pc, 29.4pc and 46.5pc respectively.

On the other hand, retail prices for kerosene have shot up 30.5pc within a year, same to diesel and super petrol whose prices increased 29.8pc and 25pc respectively.

Despite cooking gas prices dropping by 3.7pc between June and July as a result of VAT reduction on LPG, prices of a 13kg cylinder have also gone up 29.5pc when compared to July last year.

As a result of the VAT reduction, a 13kg cylinder was retailing at an average of Ksh 3,100.67 in July compared to Ksh 3,218.22 in June this year and Ksh 2,394.18 in July last year.

Even as inflation touches a 5-year high, the government has been forced to roll out subsidy programme on fuel, fertiliser and maize which Central Bank of Kenya said will help moderate inflation as it retained the base lending rate at 7.5pc in its sitting Wednesday.

“Additionally, the recent waiver of import duties and levies on white maize, the subsidy on retail prices of sifted maize flour, and the recent reduction in VAT on LPG will further moderate domestic prices,” he said in a statement Thursday.

Prices of food items are nonetheless expected to ease going into the year backed by cooling international commodity prices and increased harvest from long rains expected in October.

  

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