Kenya's consumer inflation climbed to 6.5 percent in July, marking the second-highest rate in 30 months, primarily fueled by rising transport expenses. According to data from the Kenya National Bureau of Statistics (KNBS), this was a slight increase from 6.4 percent recorded in June and just below the 6.7 percent peak in May.

The surge in inflation is largely attributed to elevated fuel prices triggered by the conflict in the Middle East, which pushed up crude oil prices globally and consequently increased domestic fuel costs.

Transport Sector Leads Inflation Surge

The transport category recorded the fastest price growth among the 13 sectors monitored by KNBS, with a 15.6 percent annual increase. This contrasts sharply with the first quarter of the year, where transport inflation averaged 4.2 percent before accelerating to an average of 14.4 percent between April and July.

  • April saw a 10 percent year-on-year rise in transport costs.
  • May peaked with a 16.5 percent increase.
  • June and July maintained high levels, with 15.6 percent inflation.

The escalation is linked to the rise in international crude oil prices following the US-Israel conflict involving Iran, which impacted Kenya from April onwards through higher pump prices. These costs have since extended beyond fuel to affect public transport fares and freight charges, increasing the cost of moving people and goods nationwide.

Despite stable pump prices in July—diesel at Sh224.04 per litre and petrol at Sh214.95—transport inflation remained elevated, indicating that operators continue to pass earlier fuel and operational cost increases to consumers.

While inter-town bus and matatu fares saw minor declines from June to July, boda-boda charges and intra-town travel fares rose, sustaining transport’s position as the fastest-growing expense for households and businesses.

Other Inflation Contributors

Food and non-alcoholic beverages recorded a 9.0 percent inflation rate, contributing 2.6 percentage points to overall inflation, the largest share. Housing, water, electricity, gas, and other fuels rose by 3.2 percent, adding 0.5 percentage points.

Although some staple food prices eased in July—tomatoes fell 3.7 percent, carrots 3.6 percent, sifted maize flour 1.6 percent, alongside slight declines in beans and cooking oil—these were offset by price increases in beef, potatoes, onions, and kale.

Electricity tariffs increased by 3.1 percent for households consuming 200 kilowatt-hours, reaching Sh5,648.30, and by 3.5 percent for those using 50 kilowatt-hours, at Sh1,286.84. Conversely, the cost of refilling a 13-kilogramme LPG cylinder dropped by 1.1 percent to Sh3,432.21.