Commodity prices still high despite inflation dropping to five-month low

Commodity prices still high despite inflation dropping to five-month low - price of sugar

Source: https://www.the-star.co.ke


While the cost of items on the food basket declined marginally in August compared to July, Kenyans are still paying more compared to the same period last year.

In it’s monthly review, the Kenya National Bureau of Statistics yesterday announced monthly inflation dropped to 5 per cent in August compared to 6.27 per cent in July.

“This decline was mainly attributed to favourable weather conditions and follows a trend that has been observed over the last five months,” KNBS said in a statement.

In August, the prices of significant food items including sukuma wiki (kales), potatoes, cabbages, carrots, tomatoes and maize grain loose decreased by 8.01, 7.81, 6.78, 6.01, 4.89 and 2.80 per cent, respectively.

“Decrease in prices of these commodities outweighed the observed increase in the cost of other foodstuffs, thereby causing a decrease in the food index,” the statistician said.

However, compared to last August when monthly inflation stood at 4.04 per cent, this month’s commodity prices were much higher.

A kilogramme of tomatoes rose the highest year on year, increasing 23.72 per cent to Sh72.49.

This was followed by kerosene, commonly used by poor households for lighting and cooking, which increased by 22.01 per cent to Sh104.80 compared to the same month last year.

Other notable increases were a 2kg bag of sifted maize which increased to sh119.89, a Sh20.54 increase compared to last August, while a kilo of carrots retailed at Sh72.49, a 18.47 per cent increase.

A kilogramme of maize grain also increased by Sh5.19 per kilogramme to retail at Sh47.58.

On the other hand, the price of sugar reported the most significant decrease, dropping by over Sh40 to sell at Sh107.22. A kilogramme of sukuma wiki (kale) also dropped 17.9 per cent to Sh37.19 compared to last August.

KNBS data shows the housing, water, electricity, gas and other fuels’ index, decreased by 0.10 percentage points in August, mainly as a result of a decrease in prices of some cooking fuels.

“The cost of a 13 kg cylinder of Liquefied Petroleum Gas (LPG) for instance, decreased by 0.98 percentage points from Sh2,171.47 in July to Sh2,150.27 in August,” KNBS said.

The transport index also reported a decrease albeit marginal due to the reduction in pump prices of diesel and petrol over the review period.