Food inflation hits record high of 15.8 per cent in October, CBK says
The Central Bank of Kenya (CBK) has said the overall inflation in the country during the month of October rose to 9.6 per cent in from 9.2 per cent that was recorded in September.
This, according to CBK, was mainly caused by food and fuel prices. According to the Central Bank of Kenya Monetary Policy Committee (MPC), food inflation rose to 15.8 per cent in October from 15.5 percent in September, largely due to prices of maize and milk following reduced supply attributed to depressed rains.
Also, fuel inflation increased to 12.6 per cent in October from 11.7 per cent in September, mainly due to scaling down of the fuel subsidy, increase in electricity prices due to higher tariffs and increased costs of transport.
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CBK Governor Dr Patrick Njoroge, who is also the MPC Chairperson, said the global economic outlook has weakened further, reflecting the impact of the rapid tightening of monetary policy in advanced economies particularly the US, and the ongoing war in Ukraine.
“Inflation pressures are showing signs of abating in some major economies, but remain elevated mainly reflecting high energy prices and persistent supply chain challenges,” Dr Njoroge said.
Dr Njoroge however said that the volatility in global financial markets remains elevated amid significant US dollar strength against major currencies, and the recent rapid changes in policy stance in advanced economies in response to inflationary pressures.
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The committee’s survey has revealed a sustained optimism about business activity, and economic growth prospects for 2022, and 2023.
“The optimism was attributed to increased economic activity following conclusion of the elections, opportunities for growth in sectors such as ICT, and the Government’s renewed focus on MSMEs,” Dr Njoroge said.
The survey in the Agriculture Sector conducted in the first half of the month revealed that prices of some key items moderated in November, while the banking sector remains stable and resilient, with strong liquidity and capital adequacy ratios. The growth in private sector credit increased to 13.3 per cent in October from 12.5 per cent in August 2022.
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