Inflation rate down to 5.39pc on lower electricity charges

Kenya’s annual inflation rate has dropped to 5.39% in the month of January on account of lower prices of electricity, the statistics bureau has said.

Data from the Kenya National Bureau of Statistics (KNBS) indicate that prices of 200 kilowatt and 50 kilowatt of electricity reduced by 15.67% and 15.73% respectively between December last year and January 2022 bringing down the rate of inflation from 5.69% recorded in January last year.

The rate of inflation recorded in January was also lower than 5.73% recorded in December 2021.

Electricity bill have fallen on a directive issued by President Uhuru Kenyatta to the Ministry of Energy during the Jamhuri Celebration on December 12 last year which targets to reduce power bill by at least 30% March this year.

The directive sought to reduce power bill in two tranches of 15% each.

For instance, the cost of 200 kilowatt of electricity has reduced from Kshs. 5185.96 to Kshs. 4373.12 while the price of 50 kilowatt has subsided to Kshs. 945.59 to Kshs. 796.83.

However while there were no month-on-month increases in the price of diesel and kerosene, the year-on-year prices skyrocketed.

Price of a litre of kerosene went up by 20.9%, from an average of Kshs. 88.07 to Kshs. 106.46 while a litre of petrol also shot up by 21%, from Kshs. 107.86 to Kshs. 130.54.

“The Housing, Water, Electricity, Gas and Other Fuels’ Index, decreased by 0.75% between December 2021 and January 2022. This was mainly attributed to decrease in prices of electricity. During the same period, Transport Index decreased by 0.11% as there was no change in prices of petrol and diesel,” said Macdonald Obudho, KNBS Chief Executive Officer.

However, Kenyans continue to feel the burden as prices of key foods continue to climb.

Year-on-year food and non-alcoholic beverages index went up 8.89% as prices of items such as maize flour, sukuma wiki and cabbage increased.

“Relative to December 2021, prices of maize flour-sifted, kale-sukuma wiki, spinach and Irish potatoes increased by 6.41%, 5.69%, 5.66% and 3.87% in January 2022, respectively. During the same period, prices of mangoes, tomatoes and carrots decreased by 3.98%, 0.65% and 0.07%, respectively. Prices of food items in January 2022 were relatively high compared with prices of food items recorded in January 2021,” Obudho added.

According to KNBS, a 2kg of maize flour now costs Kshs. 126.31 compared to Kshs. 117.36 in January 2021, an 8.32% increase.