6 Basic Food Items Whose Prices Increased In September- CBK

Spinach, tomatoes and onions were revealed to be food items whose prices increased in September, according to the Central Bank of Kenya (CBK).

CBK revealed this following its Monetary Policy Committee (MPC) meeting held on Tuesday, October 3 where the three food items as well as Irish potatoes, kales (sukuma wiki) and cabbages recorded a price increase, leading to the increase in food inflation to 7.9 per cent in September from 7.5 per cent in August.

However, Kenya's overall inflation remained broadly unchanged at 6.8 per cent in September 2023, compared to 6.7 per cent in August, which CBK stated is within the government's target range.

"Food inflation increased to 7.9 per cent in September from 7.5 per cent in August, largely on account of increases in the prices of a few key vegetables, particularly onions, Irish potatoes, cabbages, spinach, kales (sukuma wiki), and tomatoes," read CBK's statement in part.

Prices of key non-vegetable food items particularly maize and wheat flour were however revealed to have declined following improved supply attributed to the ongoing harvests and government measures to zero-rate key food imports.

CBK meanwhile revealed that the global growth outlook remains weak, reflecting the impact of monetary policy tightening in advanced economies, weakening demand particularly in China and the Eurozone, and heightened geopolitical tensions which continue to weigh down on economic activity.

"Additionally, headline inflation rates in advanced economies have remained above the respective targets, due to persistent core inflationary pressures, and higher energy costs following recent increases in the price of oil. Global food prices have declined from the peak levels witnessed in 2022 except for a few items such as sugar and rice," added the statement.

CBK further stated that the Survey of the Agriculture Sector conducted in the first half of September 2023 showed that the prices of key food items, particularly maize, were expected to decline further with the ongoing harvests in the main maize producing areas of the country.

Leading indicators of economic activity for Kenya, the bank regulator continued, point to strong performance in 2023, supported by the continued robust growth of the services sectors, the rebound in agriculture. and the ongoing implementation of measures to boost economic activity in priority sectors by the Government.

"The CEOs and Market Perceptions Surveys, which were conducted ahead of the MPC meeting, revealed improved optimism about business activity and economic growth prospects for the next 12 months. Respondents attributed this optimism largely to enhanced agricultural production, easing inflation, and improved growth prospects," added CBK.

"Nevertheless, respondents' concerns included higher fuel and electricity prices, reduced purchasing power affecting demand for products, and the possible negative effects of the El Niño weather phenomenon."

It was further revealed that goods exports increased marginally in the 12 months to August 2023, growing by 0.5 percent compared to a similar period in 2022.

For instance, receipts from tea and manufactured exports increased by 4.5 percent and 23.2 percent, respectively. The increase in tea export receipts reflected higher prices due to demand from traditional markets, while the higher manufactured exports receipts reflect strong regional demand.

Imports however declined by 11.9 percent in the 12 months to August 2023 compared to a growth of 16.0 percent in a similar period in 2022, mainly reflecting lower imports of infrastructure related equipment, manufactured goods, oil, and chemicals.

An image of the port of Mombasa. /FILE