Inflation hits 63-month high of 9.2pc on food, fuel price increase
A woman expresses shock after seeing her shopping bill. Inflation hit 9.2 per cent in September on higher cost of food, fuel and other commodities.
What you need to know:
- The rise is driven mainly by a sharp rise in the prices of food, fuel and cooking oil over the past 12 months.
Inflation hit 9.2 per cent in September, driven by an increase in the cost of food and adding pressure to the high cost of living on households, new statistics released by the Kenya National Bureau of Statistics (KNBS) on Friday show.
It is the highest inflation rate in 63 months, driven mainly by a sharp rise in the price of maize flour, electricity, fuel and transport in September.
Maize flour prices went up 8.4 per cent between August and September, power prices rose 20.9 per cent, petrol prices went up17.7 per cent while the cost of transport shot up 25 per cent.
“The overall year-on-year inflation rate as measured by the consumer price index (CPI) was 9.2 per cent. The rise in inflation was largely due to increase in prices of commodities under food and non-alcoholic beverages (15.5 per cent), transport (10.2 per cent) and housing, water, electricity, gas and other fuels (7.3 per cent),” said KNBS.
“These three divisions account for over 57 per cent of the weights of the 13 broad categories.”
This as goods under furnishings, household equipment and routine household maintenance recorded a 10.7 per cent increase during the period.
Petrol prices hit a historic high of Sh179.3 per litre after the government opted not to apply a subsidy on the product according to last month’s fuel review by the Energy and Petroleum Regulatory Authority (Epra). Diesel prices also hit a historic high of Sh165 per litre after the government increased its price by Sh25 per litre up from Sh140.03. Meanwhile, the cost of kerosene jumped to Sh147.94 per litre after Epra increased its cost by Sh20.
The sharp fuel increases saw travel and transportation costs shoot up by 25 per cent adding further pressure on the cost of living.
The energy regulator also increased the fuel cost component of the power bill by 46.6 per cent, leading to the sharp increase in prices that consumers are paying for electricity last month.
Epra raised the fuel cost charge (FCC) to Sh6.79 per kilowatt-hour (kWh) of electricity up from Sh4.63. It was the first time Epra adjusted the rate since December.
“The rise in the cost of electricity was mainly driven by a 46.7 per cent increase in fuel energy cost,” said KNBS.
The new prices, which have pushed power costs to a new high, came after the government ended its subsidy on electricity.
The increase in maize flour prices was occasioned by the end of the subsidy programme that was introduced by the government in July to lower maize flour prices for a month.
The high inflation comes as the Central Bank of Kenya on Thursday raised its policy lending rate by 75 basis points to 8.25 percent to stem rising inflation and stabilise the shilling.
The CBR had been static at 7.50 percent for four months since May 30, 2022.
