Kenya’s annual inflation rate rose for the third consecutive month in January 2025, reaching a four-month high of 3.3%, up from 3% in December. Despite the increase, inflation remained below the central bank’s 5% midpoint target for the eighth straight month, signaling relatively stable price pressures in the economy. The uptick was primarily driven by rising costs in key sectors, with food prices surging to 6.1% compared to 4.8% in December, and transport costs increasing to 0.7% from 0.1% in the previous month. These factors contributed to the acceleration in overall inflation, even as the economy continued to operate within the central bank’s preferred range.
For the first time, Kenya’s statistics agency published core inflation figures, which exclude volatile items like food and energy, to better gauge underlying price trends. Core inflation eased slightly to 2% in January, down from 2.2% in December, indicating subdued long-term inflationary pressures. However, non-core inflation, which includes more volatile components, jumped to 7.1% from 5.2% in the prior month, reflecting the impact of rising food and transport costs. The mixed data suggests that while overall inflation remains manageable, policymakers may need to monitor specific sectors closely to ensure price stability in the coming months.
