Fuel prices have dropped in Kenya for the December –January period according to the Energy and Petroleum Regulatory Authority (EPRA) taking effect from Monday to 14 Jan. 2020.
In the new price, super petrol has dropped by Ksh 1.09 per liter, diesel by Ksh 2.83 while kerosene by Ksh 1.75 in Nairobi city. The prices are inclusive of 8% Value Added Tax in line with the provisions of the Finance Act 2018.
EPRA attributed to revised rates for the Import Declaration Fee in line with the Finance Act, 2019.
The cost of imported fuel products decreased significantly between October and November. During the period, super petrol prices decreased by 0.52%, diesel 3.36% while kerosene decreased by 3.75%.
In November, the country’s annual inflation rose to 5.56% from 4.95% in October on faster food inflation and non-alcoholic beverage. The transport index increased by 0.29% due to an increase in pump prices of diesel and petrol.
“Even then, looking ahead, crude oil prices may remain generally stable due to diminished global demand, “NCBA Economic Analyst said in their Inflation reaction.
“Whereas core inflation suggests room for maneuver, another cut amid rising overall inflation may weaken market’s credibility in the signal,” they said in response to the Central Bank’s Monetary Policy Committee 50 bps policy reduction. “The MPC may also need to assess credit market’s response to the policy cut and interest rate cap repeal before moving further,” they added.
Annual average inflation is expected to remain within the Central Bank of Kenya’s target range of 5%+/-2.5pp over the medium term.
“This could allow the CBK to further lower the main policy rate,” says Global credit rating agency Fitch Ratings affirmed Kenya’s long-term foreign currency rating at B+.