Inflation hit 6.8% — but look at which half moved

Also in this week's Brief

The government is being handed more money than it asked for. Per the CBK Weekly Bulletin for the week to 1 October, as reported by People Daily and The Kenya Times, the week's Treasury bill auction drew KSh 47.7 billion of bids against KSh 28 billion offered — a 170.4% performance rate — with rates easing fractionally to 8.769% on the 91-day, 8.886% on the 182-day and 9.040% on the 364-day. The reopened 15-year and 20-year bonds, auctioned 30 September, pulled KSh 80.6 billion against a KSh 50 billion target, 161.1%. Gross domestic debt rose to KSh 7.78 trillion from KSh 7.73 trillion. Oversubscription at falling yields is the market telling you it has nowhere better to put shillings — which is comfortable for the Treasury and a problem for anyone hoping bank credit crowds in.

The shilling still is not moving. CBK's indicative rate was 129.76 to the dollar, posted 2 October. The Weekly Bulletin had 129.71 as at 1 October against 129.48 the week before, and usable reserves at USD 14.93 billion, or 6.1 months of import cover, as reported by The Kenya Times and People Daily. KESONIA, the overnight interbank rate, was unchanged at 8.75%. Note what that means alongside the inflation print: a currency this stable means imported inflation is not the culprit this month. The pressure is domestic.

The NSE drifted up on thin conviction. NSE market statistics put NASI at 247.32 as at 2 October, with the NSE 20 at 4,323.60, the NSE 25 at 7,001.48 and market capitalisation at KSh 4,150.52 billion. Equity turnover was KSh 622.8 million, up 43.8% on the previous day. Safaricom closed at KSh 36.55, Equity Group at KSh 105.50 and KCB at KSh 92.50. Three weeks of this now: a hard sell-off, a sharp rebound, then small moves either way. Flows, not fundamentals.

Kenya's second-largest supermarket is going public. Quickmart announced on 23 September that its sole shareholder, Sokoni Retail Kenya, intends to sell 2 billion existing shares — 50% of the company — on the NSE, subject to CMA and NSE approval. Per the company's own announcement, 2025 revenue was KSh 50.4 billion with adjusted profit after tax of KSh 1.7 billion, H1 2026 revenue KSh 27.3 billion, and 72 stores across 16 counties. Read the structure carefully: no new shares, no proceeds to the company. This is an exit for a private equity owner, not capital for expansion. That is not a criticism — it is the single most important thing to understand before you look at the price.

Kenyans may get a route into the Dangote refinery IPO. The NSE and CMA are structuring a Global Depositary Receipt vehicle to let Kenyan investors buy into the Lagos refinery listing, as reported by Eastleigh Voice on 30 September following an NSE investor forum on 29 September. The reported terms: Sh49.25 a share, a minimum of 10 shares, a Kenyan offer window of 5–13 October and an NSE listing targeted for 8 December — all subject to regulatory approval, none of it yet confirmed by a CMA approval notice we could find. The global offer is 4.1 billion shares for 3% of the refinery. Treat the dates as proposed.

PAYE relief goes to public participation this month. Treasury has scheduled a finance and economic week for 12–18 October, with public participation on a Bill to revise PAYE bands beginning in early October, per Treasury PS Boniface Makokha as reported on 25 September. The proposal from CS John Mbadi: no PAYE for those earning up to KSh 30,000 a month, and a reduced 25% rate between KSh 30,000 and KSh 50,000. Roughly 1.5 million workers sit in the exempt band on Treasury's own estimate. If you are about to start your first job, this is the single policy on this page most likely to change your payslip — and public participation is the stage at which it is still movable.

The IMF noticed governments are stopping the subsidies. The IMF's Global Policy Tracker on 1 October described a global shift away from fiscal shielding of energy prices toward pass-through and demand management, as reported by People Daily. The Kenyan read-across is direct: EPRA has held pump prices flat for three consecutive cycles at KSh 214.03 for petrol, KSh 217.86 for diesel and KSh 191.38 for kerosene in Nairobi, in a notice dated 14 September covering 15 September to 14 October. Flat nominal prices against a year-ago base is exactly how you get transport inflation of 15.6% without a single price increase this month. Watch the 14 October review.