Kenya’s economy is expected to grow by 4.6 per cent in 2026 before improving slightly to 4.7 per cent in 2027, according to the African Development Bank’s (AfDB) Country Focus Report 2026 released on Tuesday, July 28.
The report said the slowdown follows an estimated 5 per cent growth in 2025, citing global economic uncertainty and rising fuel costs as key factors. Kenya’s growth is projected to remain below the East African regional averages of 5.9 per cent in 2026 and 6.4 per cent in 2027.
The AfDB also forecasts inflation to rise to 5.4 per cent in 2026, remaining within the Central Bank of Kenya’s target range of 2.5 to 7.5 per cent.
The bank warned that adverse weather, high global interest rates, commodity price volatility, exchange rate pressures, geopolitical tensions and political uncertainty ahead of the 2027 elections could weigh on economic growth and investor confidence.