Kenya’s Cost of Living to Drop Further On Lower Food, Fuel Prices

Kenya is poised for a sustained decline in inflation, propelled by a consecutive four-month downturn in fuel and food prices alongside a robust shilling, offering respite to consumers grappling with a soaring cost of living.

The Energy and Petroleum Regulatory Authority effected reductions in the price of super petrol by Ksh5, diesel by Ksh10, and kerosene by Ksh18.

In Nairobi, a litre of super petrol will now fetch 193.84, diesel Ksh180.38 per litre, and kerosene Ksh170.06 per litre.

The dip in fuel costs coincides with a notable decrease in other commodities, mainly food, over recent months.

For instance, Kenya’s staple meal, a two-kilo packet of flour, has plummeted from a peak of Ksh230 to an average of Ksh140, with sugar seeing a decline from Ksh430 to Ksh330 for the same quantity.

Given the significant portion of the inflation basket that food represents, these developments hold substantial sway in shaping the overall cost of living in the nation.

Data from the Kenya National Bureau of Statistics (KNBS) on consumer retail prices reveals a downtrend in inflation to 5.7 percent in March from 6.7 percent a month earlier, mirroring the downward trajectory of food prices.

Further relief in the high cost of living is anticipated with the strengthening of the shilling, currently trading at 130 against the dollar, down from a previous high of Ksh160. This implies reduced expenses for consumers on imports, as goods are expected to become more affordable.

The decreasing fuel costs are expected to have a ripple effect, with manufacturers, power producers, and service providers anticipated to integrate these cost savings, thus contributing to the ongoing inflation downturn.

The reduction in fuel expenses is projected to extend to the electricity sector, with bills expected to align with the decreased fuel costs, thereby impacting the fuel cost charge, which holds a substantial share in electricity billing.

The persistent challenge of the high cost of living has been a focal point for President William Ruto’s government, contending with public dissatisfaction and demonstrations, witnessed last year led by the opposition.

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