editorials
Designing better tools to deal with the cost of living
Friday 02 June 2023
Packets of sugar are sold at Naivas supermarket, Nairobi on May 16, 2023. Image | Ponce Bogeta | NMG
Inflation is rising again after rising slightly in May by 0.1 percentage point as food, energy and transportation costs rose, reflecting a temporary downturn.
Data released Wednesday night shows the rate stood at eight percent, from 7.9 percent in April when it fell to a 10-month low when the rains began.
Data from the Kenya National Bureau of Statistics shows that the increase was caused by price changes in food, energy and transport, which cover about 57 percent of household budgets.
This percentage rose to 10.2%, 9.7% and 10.1%, respectively.
Housing, water, electricity, gas and other fuels that make up the energy and transport index were driven by an increase in the cost of petroleum products, with petrol, diesel and kerosene averaging Sh183.29, Sh169.10. and 161.83 shillings per liter nationwide.
Higher sugar costs doubled the index for food and non-alcoholic beverages, rising by 49.2 percent year-on-year and by 22.1 percent month-on-month, to an average of Sh194.29 in May from Sh159.10 in April.
Even worse, the cost of electricity has risen 67 percent in the past nine months, making the cost of doing business unbearable even as companies prepare to deal with a new round of tax-related costs in the Finance Act.
Rising inflation points to the fact that government interventions are either negligible or need to be reconfigured. All policymakers must sit down to come up with coordinated tools that support the goal of cost-of-living containment.