Kenya Quarterly Gross Domestic Product First Quarter 2014

Abstract

The first quarter of 2014 experienced a relatively stable macroeconomic environment despite interest rates remaining comparatively high. Inflation rose moderately but was nevertheless contained at an average of 6.78 per cent during the first quarter of 2014 compared to 4.08 per cent in the same quarter of 2013. Over the same period, the Kenya Shilling registered slight fluctuations against the US dollar, the Euro and the Tanzania Shilling and appreciated strongly against the Japanese Yen and the South Africa Rand while it depreciated significantly against the Sterling Pound.

Against this background, Kenya’s Gross Domestic Product (GDP) is estimated to have expanded by 4.1 per cent in the first quarter of 2014 compared to 5.2 per cent during the same quarter of 2013. The growth can be attributed to accelerated expansion in activities of transport and communication, manufacturing, wholesale and retail trade, mining and quarrying and electricity industries. Agriculture and forestry, and fishing recorded slowed growths while activities of the hotels and restaurants contracted during the review period. The deceleration in growth of the hotel industry was largely due to insecurity concerns coupled with negative travel advisories by some key tourist source countries. Another factor that constrained economic growth during the quarter was the erratic weather pattern that resulted in depressed agricultural output. Quantities of exports of cut flowers and vegetables declined, while that of fruits rose significantly. Activities of other key crops, in particular cereals were negatively affected by the erratic rains during the quarter.