Inflation accelerates in September

Latest reading: Consumer prices increased 4.6% in annual terms in September, following a 4.5% increase in the prior month. Inflation accelerated for the third consecutive month in September and was the joint-highest print since May 2024, though still remained within the Central Bank’s 2.5%–7.5% target range. Relative to the prior month's data, there were higher price pressures for food and non-alcoholic beverages (+8.4% on a year-on-year basis vs +8.3% in August) and housing, water, electricity, gas and other fuels (+1.4% vs +0.8% in August). In contrast, price pressures reduced for transportation (+4.0% vs +4.4% in August). Finally, the change in clothing prices was the same as in the prior month (+3.3% in September and August). Lastly, consumer prices rose 0.24% in September in month-on-month terms, following a 0.32% rise in the prior month.

Outlook: Our Consensus is for average inflation to increase from Q3’s average in Q4, then tick down in Q1 2026 before gradually rising through Q4 2026. For 2025 as a whole, inflation should edge down from 2024’s level due to lower global oil prices. In contrast, in 2026, inflation should reach a three-year-high, fueled by stronger domestic demand, previous interest rate cuts and a weaker currency vs the USD. Still, average inflation should remain well within the Central Bank’s 2.5%–7.5% target range during our forecast horizon through 2030. Upside risks to the price outlook stem from a weaker-than-expected shilling boosting import inflation.

How should you choose a forecaster if some are too optimistic while others are too pessimistic? FocusEconomics collects Kenyan inflation projections for the next ten years from a panel of 14 analysts at the leading national, regional and global forecast institutions. These projections are then validated by our in-house team of economists and data analysts and averaged to provide one Consensus Forecast you can rely on for each indicator. By averaging all forecasts, upside and downside forecasting errors tend to cancel each other out, leading to the most reliable inflation forecast available for Kenyan inflation.

Download one of our sample reports to visualize what a Consensus Forecast is and see our Kenyan inflation projections.

Want to get access to the full dataset of Kenyan inflation forecasts? Send an email to info@focus-economics.com.