Kenya's economy is facing a significant challenge as the cost of living continues to worsen, with prices of goods and services increasing by 7.1% in May, the highest level in two years.
According to data from the Kenya National Bureau of Statistics (KNBS), the increase in prices of goods and services is the highest since February 2020.
Consumers have been forced to dig deeper into their pockets to pay for basic commodities, especially foodstuff, with a kilogram of edible cooking oil rising by 47% year-on-year, retailing at an average of Sh370.71 in major towns around the country compared to Sh252 in the same month last year.
The retail price of a 500 grams of cooking fat also rose by 44.6% to retail at an average of Sh175.9 compared to Sh121.7 in May last year.
The increase in prices of cooking oil is due to the disruption in the supply of palm oil, the main ingredient used to manufacture cooking oil, from countries such as Indonesia and Malaysia.
Some of these countries, such as Indonesia, have been forced to prohibit the export of palm oil to first cater for the domestic demand.
Additionally, palm oil is also used to manufacture detergents and cosmetics, which explains why you have been paying more for bar soap and laundry soap.
For 800 grams of bar or laundry soap, consumers paid an average of Sh153.7 in May, an increase of slightly over a fifth compared to Sh122 in May last year.
There was no respite for motorists despite the fuel subsidy, with a litre of kerosene, diesel and petrol rising by 21.3%, 21.5% and 18.7% respectively in the period under review.
Wheat products have also been on the rise owing to the Russia-Ukraine war, with a two-kilogramme of wheat flour rising by almost a third to Sh166 in the review month compared to Sh129 in May last year.
Central Bank of Kenya (CBK) Governor Dr Patrick Njoroge noted that the economy is not yet out of the woods, with official data showing that prices of goods and services increased at a faster rate than wages for workers last year.
Dr Njoroge also stated that Kenya is mostly importing the high cost of living in advanced countries, with the war in Ukraine exposing the weaknesses of globalisation.
