Inflation in the country has gone down slightly to 4.4 percent in January 2026 from 4.5 percent in December 2025, reflecting a slowdown in non-core inflation, according to the Central Bank of Kenya (CBK).
In its weekly bulletin released on January 30, 2026, the CBK said: “Headline inflation declined marginally to 4.4 percent in January 2026 from 4.5 percent in December 2025, largely on account of moderation of the non-core inflation.
Non-core inflation declined to 10.3 percent in January from 11.6 percent in December 2025, while core inflation edged up to 2.2 percent from 2.0 percent over the same period.
“The decline in non-core inflation was mainly driven by moderation of prices of select food items,” the CBK noted, pointing to easing pressures from food-related components that had previously weighed on consumer prices.
The inflation outcome remains within the government’s target range and reflects relatively stable price movements at the start of the year, supported by improved supply conditions for some food commodities.
The Kenya Shilling remained stable against major international and regional currencies during the week ending January 29, 2026.
“It exchanged at Ksh 129.03 per U.S. dollar on January 29, compared to 129.02 per U.S. dollar on January 22,” the CBK reported.
Foreign exchange reserves stood at USD 12,334 million as of January 29, equivalent to 5.3 months of import cover. According to the CBK, this level “meets CBK’s statutory requirement to endeavour to maintain at least 4 months of import cover.”
The level of reserves continues to provide a buffer against external shocks and supports currency stability amid global and regional economic uncertainties.
Money market and government securities
Liquidity conditions in the money market remained adequate during the week ending January 29, supported by active open market operations.
Commercial banks’ excess reserves averaged Ksh 6.8 billion above the 3.25 percent Cash Reserve Ratio requirement. The Kenya Shilling Overnight Interbank Average Rate (KESONIA) remained largely unchanged, standing at 8.99 percent on January 29 compared to 8.98 percent a week earlier.
Interbank market activity increased, with the average number of daily transactions rising to 21 from 18 in the previous week. The average value traded also increased to Ksh 12.5 billion from Ksh 12.1 billion.
In the government securities market, the Treasury bill auction held on January 29 attracted bids worth Ksh 47.2 billion against an advertised amount of Ksh 24.0 billion, translating to a performance rate of 196.7 percent.
Interest rates on the 182-day and 364-day Treasury bills rose, while the rate on the 91-day Treasury bill declined.
The CBK data points to continued stability across key macroeconomic indicators, underpinned by easing food price pressures, sufficient liquidity, and steady foreign exchange reserves.
