CPI AND INFLATION RATES FOR THE MONTH OF AUGUST 2006

The Central Bureau of Statistics is pleased to release the Consumer Price Indices (CPI) and inflation rates for the month of August 2006, for your information and use. This data is generated through monthly data collection from retail outlets in 13 urban centres in Kenya . The data is perceived to be representative of the spending behaviour of Kenyan urban households. The price data is collected in the second and third week of the month of review in the selected retail outlets. This is in order to maintain consistency in price variations .

Consumer Price Index (CPI) increased by 0.7 per cent from 199.5 points in July 2006 to 200.9 points in August 2006. Month-on-month overall inflation rate accelerated from 10.1 per cent in July 2006 to 11.5 per cent in August 2006. On the other hand, month-on-month underlying inflation rate which excludes food items from the CPI basket also rose from 5.5 per cent to 6.0 per cent.

Table 1 shows percentage changes in indices of broad categories of items in the month of August 2006 compared to July 2006 (previous month) .

Table 1: One Month Change in Prices

Broad Item Group

% Change on Previous month

Food and Non-Alcoholic Drink

0.6

Alcohol & Tobacco

1.7

Clothing & Footwear

0.3

Housing Costs

0.8

Fuel & Power

2.2

Household Goods & Services

0.3

Medical Goods and Services

0.1

Transport & Communication

1.1

Recreation & Education

0.3

Personal Goods

-0.1

Food and non-alcoholic drink index rose by 0.6 per cent in August 2006 compared to July 2006. This was mainly attributed to increase in prices of cabbages, English potatoes, mangoes, kale (Sukuma wiki) and onions. On average, a kilogramme of cabbages was retailing at Kshs 16.72 in August compared with Kshs 14.97 in July an increase of 11.7 per cent. During the same period, prices of English potatoes increased to Kshs 20.10 in August 2006 from Kshs 18.53 the previous month .

Electricity cost and kerosene prices rose in August compared with July and this caused Fuel and Power index to increase by 2.2 per cent .

Transport and Communications index increased by 1.1 per cent as a result of rise in the prices of petrol, diesel and public transport fares .

Table 2 shows percentage changes in indices of broad categories of items in the month of August 2006 compared to last year (August 2005).

Table 2: One Year Change in Price Indices

Broad Item Group

% Change on Previous month

Food and Non-Alcoholic Drink

15.5

Alcohol & Tobacco

8.0

Clothing & Footwear

3.1

Housing Costs

5.1

Fuel & Power

13.7

Household Goods & Services

3.1

Medical Goods and Services

3.0

Transport & Communication

9.8

Recreation & Education

2.2

Personal Goods

2.1

Average All Groups

11.5

Over the last twelve months, Food and Non-alcoholic drinks index had the highest increase of 15.5 per cent followed by Fuel and Power.

Source: Kenya National Bureau of Statistics