Drop in oil price eases life for most Kenyans

Fuel prices are adjusted at a petrol station in Eldoret on September 15, 2014. FILE PHOTO | JARED NYATAYA |  NATION MEDIA GROUP

In Summary

• Data released by the Kenya national Bureau of Statistics (KNBS) on Tuesday quoted inflation at 6.02 per cent.
• The bureau attributed the drop to reduction in the cost of fuel in the review period.

By NATION CORRESPONDENT
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The country’s inflation eased marginally in December touching a 17-month low as consumers benefited from a drop in the cost of energy.

Data released by the Kenya National Bureau of Statistics (KNBS) on Tuesday quoted inflation at 6.02 per cent, the lowest level since June last year when it was recorded at 4.91 per cent. In November, inflation stood at 6.09 per cent.

The bureau attributed the drop to reduction in the cost of fuel in the review period.

“Over the same period, Housing, Water, Electricity, Gas and other Fuels index decreased by 0.06 per cent. This decline was mainly attributed to the notable falls in the cost of cooking fuels especially electricity,” KNBS said in a statement.

While the price of electricity dropped after fuel cost adjustment decreased from Sh3.47 per KWh in November to Sh2.87 per KWh in December 2014, transport index defied the decrease in petrol and diesel pump prices.

The KNBS attribute the 0.91 per cent upsurge in transportation to higher taxi, matatu and bus fare charges associated with Christmas festivities.

Food and Non-Alcoholic Drinks Index which bears the greatest weight in the CPI increased by 0.71 per cent.

The year has seen a 2.34 per cent shift in inflationary figures recording a peak in August when it peaked at 8.36 per cent.

Higher power tariffs and a rise in cost of petrol was attributed to the highest coat of living in August.

Experts predict a further drop in inflation as fuel prices drop and electricity becomes cheaper and as the government scales up production of power through geothermal sources.