Kenya’s annual inflation rate rose to 3.8 per cent in June 2025, the latest Consumer Price Index shows. This means the average price levels were 3.8 per cent higher than in June 2024.

The rise was largely driven by increases in the cost of food, transport, and housing-related expenses, which together account for more than 57 per cent of household expenditure, the report by Kenya National Bureau of Statistics (KNBS) says.

Food and Non-Alcoholic Beverages category recorded the highest annual increase at 6.6 per cent. On a monthly basis, this category rose by 1.0 per cent in June.

The largest price surges were seen in carrots at 11.1 per cent, cabbages at 10.8 per cent, and sugar at 5.5 per cent.

“The price increase was primarily driven by a rise in prices of items in the Food and Non-Alcoholic Beverages (6.6 per cent); Transport (3.2 per cent) and Housing, Water, Electricity, Gas and other fuels (0.2 per cent) over the one-year period,” the KNBS data show.

Other notable increases included maize grain loose at 2.8 per cent, spinach at 2.3 per cent, and sifted maize flour at 2.1 per cent.

However, the prices of cooking oil, unpacked fresh cow milk, and Irish potatoes fell slightly by 0.4 per cent, 0.4 per cent, and 0.2 per cent, respectively.

Transport costs rose by 3.2 per cent in the twelve months to June. Petrol prices increased by 1.6 per cent in June alone, while the cost of owning a personal vehicle rose by 1.2 per cent.

Minimal annual increase

Country bus fares went up by 1.0 per cent, and city bus and matatu fares edged up by 0.2 per cent each. Diesel prices eased, dropping by 1.1 per cent during the month.

The Housing, Water, Electricity, Gas and Other Fuels division recorded a minimal annual increase of 0.2 per cent.

Within June, there were declines in electricity costs, with a 50 kWh unit falling by 1.6 per cent to Ksh1,280.96 and a 200 kWh unit dropping by 1.5 per cent to Ksh5,738.52.

Kerosene prices decreased by 1.2 per cent to Sh147.92 per litre, while LPG dropped marginally by 0.2 per cent to Ksh3,134.91 for a 13 kg cylinder.

Solid fuel prices rose, with firewood up 2.0 per cent and charcoal increasing by 1.0 per cent. Monthly rent for a single room rose slightly by 0.2 per cent to an average of Ksh4,176.85.

Analysts say that Kenya’s inflation will remain muted this year on account of low private sector demand relative to 2024.

“Inflation is seen averaging near 2024’s level this year, as slower private spending growth offsets the effects of interest rate cuts, tax hikes, and a weaker harvest.

Food and energy shortages are an upside risk,” said FocusEconomics, a global provider of macroeconomic intelligence.

Central Bank survey for the month of May, however, sees the country booking a good harvest in the agriculture sector.

Prices in the Alcoholic Beverages, Tobacco and Narcotics category rose by 5.2 per cent year-on-year. In June, spirits were up by 0.5 per cent, wines by 0.4 per cent, and miraa (khat) by 0.2 per cent. Beer prices remained unchanged.

Clothing and Footwear also recorded a 5.2 per cent annual increase. Notable rises in June included infant clothing at 0.5 per cent and women’s trousers and dresses at 0.3 per cent each. Men’s trousers edged up by 0.1 per cent.

The Furnishings, Household Equipment and Routine Household Maintenance division rose by 2.8 per cent over the year.

Buckets and basins led the monthly rise at 0.9 per cent, followed by refrigerators at 0.8 per cent. Shoe polish and bar soap prices increased by 0.6 per cent and 0.5 per cent, respectively.

The Health division saw an annual increase of 3.7 per cent. Dewormers rose by 2.1 per cent, eye care medicine by 0.7 per cent, and cancer medicine by 0.6 per cent. Delivery charges rose 0.5 per cent and antibiotics by 0.4 per cent.

Recreation, Sport and Culture recorded a 3.1 per cent annual increase. Textbooks for school children increased by 0.9 per cent in June, while tour packages and exercise books saw slight declines of 0.1 per cent.

Education services rose by 2.9 per cent over the year, with a marginal increase in certificate course fees. Restaurants and Accommodation Services rose by 3.3 per cent.

Cakes and snacks

The most notable change in June was a 1.6 per cent rise in post-secondary school boarding fees. Cakes and snacks in hotels went up by 0.7 per cent, while take-away meals rose by 0.2 per cent.

Insurance and Financial Services remained flat during the month but registered a slight annual rise of 0.9 per cent.

The Information and Communication sector also recorded no monthly change, with an annual rise of 0.8 per cent.

Core inflation, which excludes food and fuel, stood at 3.0 per cent. The core index increased from 128.97 in May to 129.47 in June.

Non-core inflation, which includes volatile items, was recorded at 6.2 per cent. Core inflation contributed 2.7 percentage points to the overall figure, while non-core inflation added 1.1 points.

Among selected retail prices, carrots posted a year-on-year increase of 20.6 per cent to Ksh128.97 per kilogramme, while cabbages rose by 17.3 per cent to Ksh85.10.