Treasury CS John Mbadi/FILE
Treasury Cabinet Secretary John Mbadi stated that there has been a steady decline in prices of common user goods and services in electricity, diesel, petrol, milk, sugar, maize grain, maize flour and wheat flour.
He, however, said there was a slight increase in the prices of edible oil.
The price of one litre of edible oil, he said, increased by 5.0 per cent from Sh333.31 in February 2024 to Sh350.10 in February 2025.
According to the CS, the inflation rate for February 2025 has also significantly dropped to 3.5% as compared to February 2024, when the year-on-year inflation rate was 6.3%.
"This shows that retail prices increased at a slower rate of 3.5%," Mbadi said in a statement.
"This shift signals a hopeful recovery for the economy, offering much-needed financial relief and greater affordability for consumers," he added.
From the Consumer Price Index (CPI) basket of goods and services consisting of 330 items, the highest decline in average retail prices was in kerosene per litre and the highest increase was in hire of tents.
Consumers across various regions experienced a notable decline in prices.
From the four selected regions of Central, Coast, Northeastern and Nyanza, it is noted that there was a general decline in prices of most of the common commodities.
The decline in the price of 1 kg of sugar ranged from 19.8% to 25.1%.
The highest decline in absolute terms was in North Eastern, which registered a decline of Sh51.84 from Sh206.7 in February 2024.
The price of a litre of kerosene in the selected regions reduced by over 20%.
The largest reduction was registered in the coast region, which registered a decline of Sh41.9 from Sh190.6 in February 2024.
CPI measures the rate at which the prices of consumption goods and services commonly purchased by households are changing from one period to another.
Mbadi has attributed these price reductions to the positive impact of government interventions and market stabilisation.
This includes subsidies, prudent monetary policies, and the stabilization of the shilling.
According to the CS, the exchange rate strengthened from Sh160.8 to Sh129.4 per dollar by January 2025, stabilising between Sh128-130.
The Central Bank of Kenya (CBK), he said, responded by reducing the Central Bank Rate (CBR) from 13% in August 2024 to 10.75% in February 2025 and lowering the Cash Reserve Ratio (CRR) to 3.25%.
This has led commercial banks to reduce interest rates, boosting private sector credit and investment.
To combat high living costs, the government provided subsidies for fertilizer and seeds, improving agricultural production, he said in a statement.
Maize production, he said, increased to 95 million 50kg bags in 2024, up from 61 million in 2023.
Similarly, sugar production surged, benefiting both farmers and consumers with lower prices.
In the energy sector, the CS pointed out that strengthened shilling reduced petroleum and electricity costs.
The Hustler Fund, in its second anniversary in 2024, he added, lent Sh60 billion to Kenyans, helping them escape predatory lending and build credit scores.
He further explained that the government expanded cash transfer programs, supporting vulnerable populations.
"In February 2025, Sh3.52 billion was disbursed to 1.76 million households under the Inua Jamii initiative," he stated.
