- Kenya's economy posted stronger growth in the second quarter of 2026 compared to the same period last year
- The services sector was the standout performer, but agriculture and industry told a different story
- The Central Bank of Kenya has pointed to specific sectors driving the latest economic momentum
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TUKO.co.ke journalist Japhet Ruto has over eight years of experience in financial, business, and technology reporting, offering insights into Kenyan and global economic trends.
Kenya's economy expanded faster in the second quarter of 2026, with gross domestic product growing by 5.1%, up from 4.9% in the same quarter of 2025, according to the Central Bank of Kenya.
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The CBK disclosed the figures in its weekly bulletin released on Friday, October 23.
Which sectors drove economic growth?
It noted that the services sector was a key engine behind the latest growth, rising to 5.8% in Q2 2026 from 5.5% in Q2 2025.
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"Growth in the quarter was supported by improved performance in transport and storage, accommodation and food services, information and communication, finance and insurance, electricity and water supply and manufacturing," the CBK stated.
The expansion in transport and storage signals increasing movement of goods and people across the country, reflecting broader economic activity.
Growth in information and communication points to continued uptake of digital services, while gains in finance and insurance suggest more Kenyans and businesses are accessing formal financial products.
Improvements in electricity and water supply indicate progress in infrastructure that directly supports both households and productive industries.
The recovery in accommodation and food services, a sector that had suffered significant setbacks in recent years, also points to renewed consumer spending and a gradual rebound in tourism and hospitality activity.
Which sectors recorded a decline?
However, not all sectors kept pace. Agriculture, which remains the backbone of livelihoods for millions of Kenyans, slowed to 3.5% growth in Q2 2026, down from 4% in the same quarter of 2025.
The industry sector also decelerated, recording growth of 4.4% compared to 4.6% a year earlier.
The slowdown in agriculture is particularly significant given its direct link to food prices and rural incomes.
When farm output growth weakens, the knock-on effects can ripple through household budgets and informal trade, sectors that millions of ordinary Kenyans depend on daily.
A sluggish industry sector, meanwhile, raises questions about the pace of manufacturing and construction activity, both of which are critical for job creation.
While the overall headline figure points to an economy gathering momentum, the uneven performance across sectors suggests the gains are not yet being felt uniformly.
Which are the largest economies in EAC?
In other news, the IMF revealed the largest economies in the East African Community (EAC).
The figures show the differences in economic size among member states and Kenya’s position in the regional economic landscape.
Kenya’s economy, valued at $151.15 billion, is the largest in the EAC.
Source: TUKO.co.ke