Inflation declines, fails to meet government target

The cost of electricity declined as a result of a cut in the fuel surcharge from Sh2.87 in December to Sh2.53 in January. FILE PHOTO | SALATON NJAU |  NATION MEDIA GROUP

In Summary

• Inflation in January stood at 5.53 per cent compared to 6.02 per cent recorded in December.
• The figures are still higher than the five per cent government target for inflation.

By NATION REPORTER
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The cost of living has contracted for the fifth month consecutively owing to a cut in energy prices.

Latest data from the Kenya National Bureau of Statistics indicates that inflation in January stood at ........................
5.53 per cent compared to 6.02 per cent recorded in December.

The figures are still higher than the five per cent government target for inflation.

Earlier in the month, Central Bank said “overall inflation has remained in the upper bound of the government medium-term target of five per cent” to keep the benchmark lending rate unchanged at 8.50 per cent “to anchor inflation expectations.”

The government measure of change in commodities prices was highest in August 2014 at 8.36.

House rent and education registered an increase in price. The two, the statistics agency noted, are normally adjusted upward in January with the higher increase in house rents unable to outweigh notable cut in cost of cooking fuel, electricity, kerosene and cooking gas — which are normally lumped together.

The cost of electricity declined as a result of a cut in the fuel surcharge from Sh2.87 in December to Sh2.53 in January.

Education index edged up by 3.28 per cent “mainly on account of upward adjustments of private schools tuition fees at the beginning of the year.” Also going up was the price of food and non-alcoholic drinks by 0.96 per cent.

During the same period, the cost of transport declined by 1.39 per cent as a result of a reduction in the price of fuel by as much as Sh9 per litre.