Kenya unveils new inflation measures amid policy push

The National Treasury on Tuesday unveiled Kenya’s first-ever report distinguishing core and non-core inflation, a pivotal step in refining the country’s economic strategies as inflation continues to affect markets, businesses, and households.
Speaking during the launch at the Treasury Building in Nairobi, Principal Secretary for Economic Planning James Muhati emphasized that the report aims to provide policymakers with a clearer picture of price behavior by separating core inflation—excluding volatile items like food and energy—from non-core inflation.
“By doing so, policymakers can craft more effective responses to inflation,” Muhati said, highlighting the collaboration between the Central Bank of Kenya and the Kenya National Bureau of Statistics in producing the report.
Governor of CBK Dr. Kamau Thugge and KNBS Director General Dr. Macdonald G. Obudho attended the launch, which underscored the importance of reliable data in shaping economic policies.
Core inflation focuses on stable price trends by excluding food and energy prices, which are often subject to unpredictable fluctuations.
This approach provides a clearer reflection of overall price behavior, aiding long-term planning. Non-core inflation, by contrast, captures the volatility of these essential categories, offering insight into immediate pressures on households.
“This partnership reflects international best practices and underscores the importance of robust data in addressing inflation with precision,” Muhati noted.
The report aligns with the government’s Bottom-Up Economic Transformation Agenda, aimed at fostering socio-economic development. Muhati stressed that understanding inflation dynamics is key to ensuring rising prices do not outpace income levels, which would erode consumers’ purchasing power and living standards.
As KNBS continues to release monthly Consumer Price Index and headline inflation data, this new report equips policymakers with sharper tools to address both long-term economic stability and short-term household pressures.