Headline inflation declines to 4.6% in June, KNBS

KENYA- In a recent survey, the Kenya National Bureau of Statistics (KNBS) has revealed that headline inflation dropped to 4.6% in June after remaining stable at 5% in the past two months. 

According to the market survey, food and non-alcoholic beverages prices increased by 0.7% in June compared to May. The prices of common vegetables like kale, spinach, and cabbage increased by 10.7%, 11.3%, and 14.8%, respectively. 

However, the prices of fruits, sugar, and maize flour dropped by 2.5%, 2.4%, and 2%, respectively, in June. 

The Fuel Index increased by 0.4% in June because of an increase in prices of 50kWh and 200kWh of electricity by 3.4% and 2.9% respectively. The Fuel Index increased despite a decline in LPG prices and kerosene by 0.3% and 3.4% respectively. 

The survey revealed a continuation of the downward trend witnessed in inflation since the start of the year. Headline inflation dropped from 6.9%, 6.3% and 5.7% in January, February and March respectively. Headline inflation marginally increased in May to 5.1% in May after dropping to 5% in April. 

The stabilization experienced between April and May is attributed to the above-normal rainfall experienced in Kenya during the two months, which negatively affected agricultural production in the country.  

It is also attributed to the gains the shilling has progressively made against the dollar. 

Although there have been visible inflation gains since the start of the year, the cost of maintaining homes and purchasing individual consumer goods remains high, which reflects a high cost of living in the country. The KNBS reveals that the cost of housing, transport, and essential items account for the bulk of the headline inflation index. 

KNBS said in a statement, “These three divisions [cost of moving goods, home maintenance, and purchasing essential items] account for over 57% of the weights of the 13 broad categories.” 

KNBS conducts surveys each month examining the retail cost of goods and services. The bureau picks a range of items most commonly purchased by consumers and calculates the consumer price indices and inflation rates reported. The results of the survey are used by various stakeholders to make purchasing decisions.