The Star (Nairobi)

Kenya: Inflation Holds At Single Digit but Prices Still High

KENYA's rate of inflation dropped for the third month in a row to 7.15 per cent in December despite slight increases in prices of most of the basic items.

The prices of milk, chicken -which is popular during the festive season-, cooking fat, bread and beef all rose slightly pushing up the food and alcoholic drinks index by 0.55 per cent according to data released yesterday by the Kenya National Bureau of Statistics.

A 500ml packet of milk retailed at an average price of Sh53.83 from Sh53.61; a kilo chicken cost Sh513.74 up from SH499.30; cooking fat price rose slightly by 0.2 per cent to Sh217.51 and one kilo of beef with bones sold at an average Sh354.40 from Sh351.18.

Bread price also increased slightly from Sh49.43 to Sh49.46. The only drop in prices in the food category was for carrots which retailed at Sh90.99 per kilo from Sh91.58 in November and sukuma wiki which sold at an average Sh43.83 per kilo from Sh44.30.

Average prices of gas, petrol, kerosene and diesel went up but despite this, the Housing, Water, Electricity, Gas and other Fuels index increased only by a modest 0.01 per cent because of a significant reduction in the cost of electricty.

In December, 50Kwh of electricity was priced at Sh517.20 dropping by 15.2 per cent from November's price of Sh609.70. "Despite introduction of a water resource management levy six cents per Kwh electricity, costs reduced significantly due to waiving of inflation levy and reduction of forex adjustment costs," said KNBS.

Over the one year period, carrots, milk and sukuma wiki had the highest increases in price compared to the same time last year rising by 42.1 per cent, 27.4 per cent and 32.9 per cent respectively.

Last December the average price of a 500ml packet of milk was Sh42.26, a kilo of carrots was Sh64.05 while a kilo of sukuma wiki was Sh32.98.

The year started with a low inflation rate of 3.67 per cent in January which went up and down in alternate months until June when it stood at 4.91 per cent and rose subsequently over the next three months to September when it peaked at 8.29 per cent. In October, the rate started on a gradual decline of 7.76 per cent to close the year at 7.15 per cent.

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