Dry weather boosts Kenya’s annual CPI inflation to 5-month high of 6.31% in March

By bne IntelliNews March 31, 2015

A spike in food prices boosted Kenya’s headline annual CPI inflation rate to a five-month high of 6.31% in March from 5.61% in February, data from the Kenya National Bureau of Statistics (KNBS) showed. However, inflation remained within the government's medium-term target of 5% plus/minus 2.5pp for the seventh month in a row after a temporary breach in July and August.

The prices of food and non-alcoholic beverages, which are the main inflation driver with a 36.04% weight in the consumer basket, jumped 11% y/y, accelerating from an 8.7% y/y growth in February due to dry weather conditions.

The prices of housing, water, electricity, gas and other fuels, which account for 18.3% of the total consumer price index, grew 2.92% y/y, easing from a 3.27% y/y growth in February.

Transport costs, which have an 8.66% weight, grew 2.77% y/y, slowing from a 3.42% y/y rise in the previous month.

Kenya’s monthly headline inflation rate slowed to 1.12% in March from 2.93% the month before, as food prices rose 2.65% (+5.01% in February), the cost of housing, water, electricity, gas and other fuels edged down 0.05% (+1.09% in February), and transport costs fell 0.33% (-0.96% in February).

The Central Bank of Kenya (CBK) noted in February that although soft oil prices continue to support price stability, there is risk for foreign exchange volatility and inflation amid divergent monetary policy paths taken by major advanced economies. It retained its benchmark interest rate at 8.5%.

y/y inflation rate Mar-15 Feb-15 Mar-14 weight
All items 6.31% 5.61% 6.27%        100    
Food and non-alcoholic beverages 10.96% 8.70% 8.29% 36.04
Alcoholic beverages, tobacco and narcotics 1.81% 2.12% 7.24% 2.06
Clothing and footwear  4.32% 4.53% 4.84% 7.43
Housing, water, electricity, gas and other fuels  2.92% 3.27% 4.44% 18.3
Furnishings, household equipment and routine household maintenance 4.17% 4.44% 5.48% 6.16
Health  4.14% 4.84% 6.84% 3.13
Transport  2.77% 3.42% 5.17% 8.66
Communication  0.59% 0.58% -3.13% 3.82
Recreation and culture  3.16% 3.35% 12.63% 2.25
Education  3.92% 4.16% 5.62% 3.14
Restaurant and hotels 4.97% 5.23% 6.19% 4.48
Miscellaneous goods and services 4.20% 4.25% 4.47% 4.52
Source: Kenya National Bureau of Statistics        

Related Articles

Russia's Rosneft sets foot in Mediterranean with $1.125bn Eni deal

Russia's largest oil producer state-controlled Rosneft has acquired 30% in the largest natural gas field in the Mediterranean from Italian Eni, the company announced on October 9. Rosneft that ... more

PetroSA, Rosgeo sign $400mn oil and gas exploration agreement for South Africa

South Africa's national oil company PetroSA and Rosgeo, the geological exploration company of the Russian Federation, have signed an agreement on a $400mn oil and gas development project in South ... more

South Africa’s MTN to invest $350mn in Iranian broadband

South Africa’s MTN said it has agreed, on a non-binding and preliminary basis, to invest an initial $350mn into Iranian fixed broadband provider Iranian Net. The investment will give ... more

Dismiss