The statistics agency said that Kenya’s consumer inflation rose to 7.9 per cent year over year in June, the most significant yearly increase since August 2017.
Based on the consumer price index (CPI), inflation rose to 7.9 per cent in June, against 7.1 per cent in the previous month and 8.04 per cent in August 2017.
The Kenya National Bureau of Statistics (KNBS) attributed the increase in prices of essential household commodities like flour, cooking oil, cooking gas, and beverages to 13.8%.
“The rise in annual inflation was mainly due to an increase in prices of food and beverages at 13.8%, household commodities (9.2%), household utility increased by 6.8% as transport rise by 7.1% for the last 12 months,” the KNBS report stated.
June Inflation as measured by the Consumer Price Index was 7.9%. This is an increase from May's 7.1% https://t.co/AIxuCPcOmY @KeTreasury @CBKKenya @KRACorporate @FKEKenya @jumuiya @StatisticsUg @NBSTanzania @NBS_Statistics @statisticsRW @IsteebuB pic.twitter.com/T3LyOt4LCk
— KNBStats (@KNBStats) June 30, 2022
The Central Bank of Kenya expects the inflation rate to rise above the government’s target of 7.5 per cent in the coming months on the uncertain global supply of essential commodities.
“The high inflation witnessed is supply induced. The accommodative policy aims to contain these secondary effects,” CBK governor Patrick Njoroge said in May.
“Price pressures are rising locally as food and energy prices hit record highs. With elevated inflation, the prospect of a cost of living crisis has increased. The risk is exacerbated by the growingly slim prospect of government intervention, given the squeeze on public resources,” NCBA Market Analysts state in their June Economic Review report.
NCBA also expects food inflation to remain in double digits throughout this year, driven by prolonged disruptions in global food supply chains, domestic weather shocks, high input costs as well as rising costs of transportation and value addition.
“We expect the regulator to raise interest rates by 100bps this year, faster than we initially projected. There is a fair risk that inflation will remain uncomfortably high through the year.”
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