High food prices push January inflation to 6.99pc

Rising food prices have pushed January inflation to 6.99 percent up from 6.35 percent in December.

This is the highest inflation rate since February 2016 when inflation stood at 6.85 percent, further piling pressure on the cost of living.

Data from the Kenya National Bureau of Statistics (KNBS) shows that the food and non alcoholic beverages index rose by 1.66 percent during the month.

The index however spiked 12.5 percent compared to the same period in 2016.

Food accounts 36 percent of the basket of goods used to calculate inflation, underlying its influence on the cost of living.

The rise in the cost of food is attributable to the prevailing drought.

“This was mainly attributed to increases in prices of cabbages, spinach, Sukuma wiki, maize flour, what flour and maize grain which were partly contributed by prevailing drought conditions,” KNBS said in a statement.

The price of a kilogram of sukuma wiki and cabbage rose by 6.7 percent during the month to sell at Sh48.74 and Sh71.58 respectively.

The price of a two kilogram packet of maize flour rose to Sh119.64.

Central Bank of Kenya governor Dr Patrick Njoroge said it the banking regulator would continue monitoring inflationary pressure.

The CBK retained the central bank rate at 10 percent on Monday warning that prolonged drought poses a risk to stability.

“We are expecting growth of 5.7 percent this year, taking into account the adverse effects of drought in the first quarter,” Dr Njoroge said while addressing journalists on Tuesday.

Apart from high food costs, consumers also had to bear with higher electricity bills following adjustment of the fuel cost levy.

During the month, households using 200 kilowatt hours paid Sh3,575 up from Sh3,497 in December.

The inflation however remains within the government upper limit of 7.5 percent.