Africa Edge

Research evidence excerpt

Africa Edge

Gbolahan S Taiwo (44-20) 3493-3412 Africa Economic Research J P M O R G A N

gbolahan.taiwo@jpmorgan.com Africa Edge

J.P. Morgan Securities plc 03 July 2026

Francesco Arcangeli (44-20) 3493-0971

francesco.arcangeli@jpmorgan.com

Figure 3: Contribution to monthly inflation in June celerated: “recreation and culture” and “restaurants and

%-pt contribution hotels” pushed services inflation up to 2.9% m/m from 0.9%

0.2 in May.

Figure 5: Contribution to June monthly inflation 0.1

%-pts

0.1

0.0

Food & Transport Furnishings, Restaurants & Miscellaneous

Nonalcoholic household hotels

beverages equipment

Source: Haver Analytics, J.P. Morgan

We revise our 2026 inflation forecast slightly lower, with

headline inflation now seen averaging 5.7% y/y (from 5.9%).

Continued KES stability—despite wider current account defi- Source: haver Analytics, Ghana Statistical Service, J.P. Morgan

cits—should help anchor inflation and expectations, but we

still see inflation staying above the CBK’s 5% mid-target We expect headline inflation to edge lower in July, mainly on

through year-end. Accordingly, we keep our call for the CBK softer transport prices, but to re-accelerate above 5% y/y from

to hold the policy rate (CBR) at 8.75% for the rest of the year. August on unfavorable base effects. Our full-year forecast is

now 4.5%oya on average. Risks skew to the downside if late-

Figure 4: Kenya headline inflation and policy rate 3Q harvests deliver more meaningful food disinflation than

% we currently assume, and sizeable current account surpluses

Headline Policy rate

14 should help keep FX pressures contained. While elevated real

Upper band rates could create room for the BoG to resume easing in late 12

10 3Q/4Q, we stay cautious and continue to expect policy to