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Economy

Ease in food prices cuts inflation rate to 7.06 per cent

A fruit and vegetables trader: Food takes up the largest share of the basket of goods that is used to calculate inflation, making it the main driver of the cost of living. PHOTO | FILE
A fruit and vegetables trader: Food takes up the largest share of the basket of goods that is used to calculate inflation, making it the main driver of the cost of living. PHOTO | FILE  

Inflation dropped to 7.06 per cent in September on easing food and electricity prices.

The cost of living measure is down from 8.04 per cent in August.

The rate has slid back to within government’s preferred band of 2.5 to 7.5 per cent.

“Between August and September, food and non-alcoholic drinks’ index decreased by 1.28 per cent,” the Kenya National Bureau of Statistics (KNBS) said in a statement.

Carrots dropped by the biggest margin of 32 per cent to an average price of Sh67 a kilo while a similar quantity of cabbages dipped 13 per cent to Sh46.

Tomatoes, however, continued to rise, crossing the Sh100 level for the first time this year with a kilo retailing at Sh103.

Largest share

Food takes up the largest share (36 per cent) of the basket of goods that is used to calculate inflation, making it the main driver of the cost of living.

Food inflation eased to 11.50 per cent in September from 13.57 per cent a month earlier, the bureau said.

Homes and businesses also got a reprieve from lower electricity bills after the forex levy dropped.

Customers that consume 200 kilowatt hours (kWh) per month paid Sh3665 in September, down from Sh3,944 a month earlier.

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