July inflation shoots up after inconsistent food prices

Inflation rose to 4.35% in July despite the decrease in food and non-alcoholic beverages index during the chilliest month of the year so far.

Numbers from the Kenya National Bureau of Statistics (KNBS) show that inconsistency in food prices saw the index decrease to 2.4% as against June. The index also decreased by 0.53% in comparison to the same period last year.

” Food and Non-Alcoholic Drinks’ Index decreased by 2.40 per cent…  this was due to decrease in prices of some foodstuffs outweighing increases recorded in respect of others,” KNBS said on August 1.

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The price of 1 kilogram of sugar for example shot up nearly 7% to retail at Ksh 137.11. A kilo of potatoes also required a price increase of around 3% more after having sold at Ksh58.31 in June to settle at Ksh60.12 in July. A kilo of Sukuma wiki and a kilo of beans meanwhile decreased by 0.5% and 1.74% respectively to retail at Ksh57.58 and Ksh107.66 respectively.

July’s inflation was also significantly affected by the cost of accessing health services, after the index rose highest of all cost of living measure indicators to settle at 1.97% upsurge.

The cost of renting went up by 0.2% to Ksh4,344 while electricity costs also rose. Gas (liquified petroleum gas – LPG) prices also saw an increment. Fuel prices recorded a rise in 1 litre of kerosene and 1 litre of petrol which outweighed the slight decrease in cost of diesel of a similar amount. This impacted transport costs to hike by 0.62%.

It means that overall, Housing, Water, Electricity, Gas and Other Fuels’ Index, increased by 0.12% in July.

Electricity costs are however expected to drop following the scrapping of a Ksh150 monthly fixed charge for low cost consumers by the government. The estimated 82% fall in power costs is estimated to affect  3.6 million people.

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July’s inflation figure is the highest in the span of four months in a year that began with inflation rate gradually decreasing during the first three months but then spiking in the middle of the second quarter to now maintain an upward trend.