Kenya’s inflation quickens in October for second Month on food

Kenya’s consumer inflation rate rose for a second month in October, fueled by an increase in food prices, the statistics office said on Friday.

The consumer price index climbed 6.7 percent in the year through October, from 5.97 percent the previous month, the Kenya National Bureau of Statistics said in an e-mailed statement. Food and non-alcoholic beverages, which account for more than a third of the index, rose by 0.88 percent in October from the previous month. The cost of housing, utilities and energy, which have a weighting of 18 percent, increased by 0.69 percent, while furnishings and household equipment were up 0.6 percent.

Inflation peaked at 7.08 percent in April before the central bank increased its benchmark rate by 3 percentage points in June and July to support the country’s weakening currency. The shilling has since strengthened against the dollar to 102.13 at 10:23 a.m. in Nairobi trading, from a low of 106.67 on Sept. 8. Kenya has a medium-term inflation target range of 2.5 percent to 7.5 percent.

Interest rates are set to fall as “inflation is contained,” Treasury Secretary Henry Rotich told lawmakers on Thursday. “What drove it was the exchange rate and that is beginning to appreciate.”

 – Bloomberg [Helen Nyambura-Mwaura]