Kenya's annual consumer price inflation, as measured by the Consumer Price Index (CPI), stood at 3.8 per cent in May 2025. This indicates that the general price level in May 2025 was 3.8 per cent higher compared to May 2024. The increase was predominantly influenced by rising prices in three key divisions: Food and Non-Alcoholic Beverages, Transport, and Housing, Water, Electricity, Gas and other fuels. These three categories collectively constitute over 57 per cent of the total weight across the 13 major expenditure categories.

Understanding the CPI and Inflation Rate

The CPI serves as a crucial economic indicator, measuring the cost of acquiring a consistent basket of goods and services. It compares current prices against those from a base period, which for Kenya is February 2019. The inflation rate is derived from a meticulous monthly survey of retail prices, targeting a representative selection of household goods and services. Data collection occurs during the second and third weeks of each month, drawing from a statistically robust sample of outlets in urban areas across 50 data collection zones nationwide.

Monthly Price Movements

On a month-over-month basis, the overall CPI saw an increase from 144.09 in April 2025 to 144.88 in May 2025, translating to a monthly inflation rate of 0.5 per cent.

Key Divisional Contributions to Inflation

The annual inflation rate of 3.8 per cent was primarily fueled by the following divisions:

• Food and Non-Alcoholic Beverages: This division saw a 6.3 per cent increase over the one-year period. It also recorded a 1.2 per cent rise between April and May 2025.
• Noteworthy Price Changes (April 2025 to May 2025): While prices for potatoes (Irish), oranges, and fresh packeted cow milk saw drops of 3.7 per cent, 1.8 per cent, and 0.6 per cent respectively, significant increases were observed for sugar (4.3 per cent), maize flour sifted (3.9 per cent), and kale-Sukuma wiki (3.5 per cent).
• Transport: Prices in this sector rose by 2.3 per cent annually. Monthly, the Transport Index edged up by 0.2 per cent from April to May 2025, mainly attributed to increased costs of international flights. Prices for petrol and diesel remained stable during the review period.
• Housing, Water, Electricity, Gas and Other Fuels: This category experienced a modest 0.8 per cent increase over the year. Between April and May 2025, the index showed a negligible change. Positively, the price of a 50 kWh unit of electricity declined by 1.0 per cent, and a 200 kWh unit by 0.9 per cent. Furthermore, the price of Gas/LPG dropped by 0.5 per cent.

Other divisions also contributed to the overall inflation, including Alcoholic Beverages, Tobacco and Narcotics (5.5%), Clothing and Footwear (3.6%), Health (3.6%), and Restaurants and Accommodation Services (3.8%).

Core vs. Non-Core Inflation

Core inflation, which excludes volatile items like food and energy, stood at 2.8 per cent in May 2025. This was largely due to price increases in commodities such as fortified maize flour and wheat flour within the core basket. The core index increased from 128.48 in April 2025 to 128.97 in May 2025.

Conversely, Non-core inflation was 6.0 per cent during the same period, primarily reflecting the higher increases in food and energy prices. In terms of contribution to the overall inflation, core inflation accounted for 2.7 points, while non-core inflation contributed 1.1 points. Food and non-alcoholic beverages alone contributed 1.9 points to the overall inflation figure.

Overall, May 2025 saw Kenya's inflation holding steady, with food prices continuing to be a primary driver of the general price level increase. The detailed breakdown provides insights into specific commodity movements, offering a clearer picture of the economic landscape.

How Inflation Affects Your Money:

Yuthufu.com

Curious how much your Kenyan Shilling has changed in value? See what 1 KES from 1963 could buy today using our inflation calculator available at Yuthufu.com

Notes

KNBS Report: knbs.or.ke