Kenyan Inflation In One Picture: Inflation Eased Its Grip But Cost Of Living Stands Firm

By Standard Investment Bank / Published January 5, 2024 | 7:10 am

The average y/y inflation for 2023 stood at 7.7 percent, 10bps higher than the 7.6 percent in 2022. The marginal rise is partly attributed to an upswing in fuel inflation, with petrol, diesel, and kerosene having surged by 19.8, 24.4, and 36.4 percent, respectively, YTD.

However, this uptick was offset by a decrease in food inflation, which declined to 7.7 percent as of December 2023, from 13.8% in 2022. Non-food non-fuel inflation also declined to 4.1 percent, from 3.4 percent over the same period.

Despite surpassing the Central Bank of Kenya’s (CBK) target ceiling by 20bps, it is noteworthy that the average figure remained well within the prescribed range during the second half of 2023 – however, we maintain our stance that the cost of living remains elevated, attributing the apparent softening to the influence of the high base effect.

Globally, the average y/y inflation for 2023 stood at 7.7 percent, 10bps higher than the 7.6 percent in 2022. The marginal rise is partly attributed to an upswing in fuel inflation, with petrol, diesel and kerosene having surged by 19.8, 24.4, and 36.4 percent, respectively, YTD.

However, this uptick was offset by a decrease in food inflation, which declined to 7.7 percent as of December 2023, from 13.8 percent in 2022. Non-food non-fuel inflation also declined to 4.1 percent, from 3.4 percent over the same period.