The paradox of rising cost of goods but falling inflation in December

Mwagushe Mwapitu cuts some of his sukuma wiki into pieces for sale at Majengo Market in Mombasa County on Friday 6th November 2015. He sells at Ksh20 per bag and says he gets his sukumawiki together with Spinach from a white farmer who does farming at Mtongwe . Photo/Kelvin Karani

Inflation has hit four and a half year low despite an increase in the cost of essential goods and services. The rate at which price of goods increase slid to 4.5 per cent year-on-year in December down from 4.7 per cent in November.

This is despite the fact that prices of food and beverages, energy and transport rose within the review period.

"Food and non-alcoholic drinks index increased by 0.25 per cent. This was mainly due to increases in prices of some foodstuff which outweighed the fall in others,” said Kenya National Bureau of Statistics Director General Collins Omondi.

According to the basket of food items studied by the statisticians, the price of a kilo of sukuma-wiki, increased by 10 per cent from Sh39.3 to Sh43.6.

The price offsets came in oranges and mangoes which fell 4 per cent each but are rarely found on the average Kenyans daily meal.

Tomatoes, also fell by 4 per cent with a kilogram selling at Sh94 in December from Sh98 in November 2017.

Mr Omondi also said that housing, water, electricity and other fuels index increased by 0.27 per cent which was attributed to the slight increases in the prices of charcoal and kerosene.

Consumers would also be wondering how inflation went down despite the move by Energy Regulatory Commission (ERC) which hiked fuel pump prices to a four-month high two weeks ago.

"The transport index reported an increase of 2.4 per cent in December compared to November on account of increase in pump prices of both petrol and diesel as well as higher bus fares associated with business festivities,” KNBS Director General said

Country Bus fares increased by 6 per cent from Sh995 to Sh1,059 per 350 kilometres, an equivalent of Nairobi to Eldoret.

Matatu fares, on the other hand only increased by 1 per cent from Sh400 to Sh407 every 250 kilometres, a distance equivalent of Nairobi to Kericho.

Petrol increased from Sh103.5 to Sh105 while diesel stayed put at Sh92.4. [Otiato Guguyu]