Transport costs in Kenya rose 13% over the last 12 months, the steepest increase across all sectors, propelling rampant inflation across the economy, according to data released by the Kenya National Bureau of Statistics (KNBS).
The transport category, covering costs for petrol, diesel and public transportation, saw the largest price growth out of 13 sectors tracked in the Consumer Price Index (CPI) for September 2023, the agency’s report showed. The outsized jump reflects a global energy crunch hitting the East African nation.
“During the reference month, all sectors continued to record general increase in prices,” the KNBS said. But “prices of commodities under Transport increased by 13.0 percent” from September 2022, far outpacing other major categories.
That 13% transport inflation dwarfed the 7.9% price growth in food and 6.3% in housing over the same one-year period. Transport accounts for 9.6% of the overall CPI consumption basket monitored by the agency.
The KNBS report directly linked the category’s sky-high inflation to rising costs for motor fuels. Prices at the pump for petrol jumped 8.7% in September while diesel surged 11.8% month-over-month.
Read more: Why the All-Share Index has limitations in gauging market performance
Ordinary Kenyans have struggled with painfully high fuel costs for over a year now, dampening consumer spending and economic growth. In March 2022, the government cut taxes on petrol in an effort to limit price increases offered some relief.
But global supply challenges continue exerting upward pressure on transport costs. “The increase was mainly driven by rise in prices of petrol and diesel,” the agency reiterated in its monthly report.
The newly released CPI data comes as central banks worldwide battle strong inflationary forces. Policymakers at the Central Bank of Kenya have steadily raised interest rates this year trying to tighten money supply and cool demand in the economy.
The KNBS report showed prices broadly rising across the 13 categories that make up the CPI.
With transport costs running red-hot, analysts expect inflation to remain painfully high in the coming months. That could lead to more rate hikes by the central bank, extending economic uncertainty into 2023 for consumers and businesses.
Email your news TIPS to editor@thesharpdaily.com
