Why the Kenyan Government Says the Economy Is Improving But Life Feels Hard

What is Inflation?

Inflation is when prices keep rising, and money loses value. For example, a loaf of bread that cost KES 50 now costs KES 65.

Kenya’s average inflation in 2023 was 7.7%, which the government considers manageable. However, this figure masks sharp increases in essentials that burden families the most—food rose from 6.4% in 2019 to 9.7% in 2023, transport jumped from 7.6% to 12.2%, and housing and utilities climbed from 4.1% to 8.1% according to data from Economic Survey 2024. These steep hikes have made everyday life significantly more expensive for ordinary Kenyans.

But why does the government believe the economy is on the right track ?

The government sees progress because inflation averaged 7.7% in 2023 similar to 2022. The economy is also growing, driven by sectors like agriculture and technology, which contribute to a stronger GDP. Additionally, a stable currency and reduced deficits signal better fiscal management, boosting confidence in the country's economic direction. However Life feels tough because the essentials people rely on—like food, housing, and transport—have seen the steepest price increases, leaving little room for flexibility in household budgets. At the same time, wages have remained stagnant, meaning people earn the same but can afford much less. While the economy grows, the benefits often flow to businesses and the wealthy, leaving ordinary citizens struggling to keep up. Adding to the strain, new taxes and reduced subsidies have made basics like fuel and electricity even more expensive, piling pressure on already tight incomes.

Example

Mary, part of the middle-income group, used to feed her family with KES 500 a day in 2019. By 2023, rising food prices and increased taxes meant the same amount barely covered their needs, leaving her struggling to keep up. Despite positive economic indicators, families like Mary’s are burdened by the soaring costs of essentials.