Kenya’s inflation rate down to 5.7% in March on flour, fuel price drop
TLDR
- Kenya's inflation rate in March decreased to 5.7% from February's 6.3% due to the Kenyan shilling's strong position against the dollar.
- Transportation costs, housing and utilities, and food expenses experienced a rise in the preceding year but saw a downturn in March.
- Despite the marginal decrease in inflation, high prices in transportation, home maintenance, and essential purchases continue to remain a significant burden on living costs.
Kenya in March saw a marginal decrease in its year-on-year inflation rate, which fell to 5.7% from February's 6.3% while in the one year to last month, the country experienced rising costs in transportation (up 9.7%), housing and utilities (up 8.0%), and food and beverages (up 5.5%).
However, these expenses saw a downturn in March, attributed to the Kenyan shilling's strengthened position against the dollar, currently trading at KES 132 to the dollar.
Despite this positive development, the prices associated with transportation, home maintenance, and essential purchases remain notably high, indicating a continued burden of living costs. According to the Kenya National Bureau of Statistics (KNBS), these three categories collectively contribute to over 57% of the weights among the 13 broad categories.
Key Takeaways
Consumer price indices and inflation rates in Kenya are derived from monthly surveys that assess the prices of goods and services in various shops and stores. The Kenya National Bureau of Statistics (KNBS) selects a range of commonly purchased items to represent typical consumer spending patterns. These surveys are conducted during the second and third weeks of each month and cover diverse regions across Kenya, with selected shops reflecting the shopping habits of the population. In response to economic challenges such as inflation, currency depreciation, and global supply chain disruptions, Kenya's central bank (CBK) and other East African counterparts are adjusting interest rates to support their economies. This suggests a departure from the coordinated monetary policies previously employed worldwide to manage rising prices, signaling a shift towards more localized economic strategies.
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