Kenya’s annual inflation rate rose to 6.6% in August 2026, up slightly from 6.5% in July, according to data released by the Kenya National Bureau of Statistics (KNBS). The overall consumer price index increased from 155.20 in July to 155.85 in August, translating to a monthly inflation rate of 0.4%, double the 0.2% recorded the month before. The reading marked the second straight monthly rise in inflation and came in above the 6.4% median forecast from economists surveyed by Bloomberg, as elevated fuel costs linked to the Iran war fed through into other prices across the economy.
Three expenditure categories accounted for most of the pressure. Food and non alcoholic beverages rose 9.0% year on year, contributing 2.6 percentage points to the overall figure, while transport costs jumped 15.7%, adding a further 1.5 percentage points. Housing, water, electricity, gas and other fuels climbed 3.6%, contributing another 0.6 points. Together, these three categories make up more than 57% of the total weight across the 13 major expenditure groups tracked by KNBS, meaning shifts in fuel and food prices tend to move the headline number more than almost anything else. Transportation, in particular, bore the brunt of higher global oil prices filtering into the domestic economy, a reminder of how exposed Kenya remains to external shocks given its heavy reliance on imported fuel.
Not every price moved in the same direction. Between July and August, the cost of 2kg sifted maize flour fell 2.7%, while tomato prices dropped 2.2%, even though they still sat 29.3% higher than a year earlier. Diesel prices eased by roughly KSh5 per litre, a 2.2% decline, offering some relief even as broader costs climbed.
The 6.6% rate keeps inflation above the midpoint of the Central Bank of Kenya’s 2.5% – 7.5% target range for a fifth consecutive month. Core inflation, which strips out volatile items, also accelerated, rising to 3.4% from 3.2% in July, suggesting the effects of higher fuel costs are beginning to spread more broadly through the economy rather than staying confined to transport and energy alone. Analysts describe the uptick as modest but persistent, and say the coming months will be telling: whether this marks the start of a sustained upward trend or simply a temporary fluctuation remains an open question for policymakers, businesses and households alike.
