Key facts
- Kenya's CPI inflation reached 6.7% year-on-year in May.
- Transport inflation surged to 16.5%.
- Fuel price increases linked to the Iran conflict are impacting consumers.
- Inflation is nearing the upper bound of the target band.
Kenya's Consumer Price Index (CPI) inflation rose to 6.7% year-on-year in May. This acceleration brings inflation close to the upper end of the central bank's target band, potentially limiting its ability to implement further monetary easing. The surge in inflation was significantly influenced by a sharp increase in transport costs, which reached 16.5%. This rise in transport inflation is attributed to fuel price shocks stemming from the ongoing conflict in Iran, which are now being felt by consumers.