The Central Bank of Uganda decided to maintain its policy rate, stating that despite the belief that inflation had reached its lowest point, significant uncertainties persisted on the economic horizon.
This marks the second consecutive decision to maintain the rate at 9.5% (UGCBIR=ECI), signaling a consistent stance of stability by the Central Bank.
In August, responding to a year-on-year inflation rate falling below its medium-term target of 5%, the Bank of Uganda implemented a reduction of 50 basis points in its lending rate.
In November, the year-on-year inflation, as indicated by UGCPIY=ECI, experienced a marginal uptick, rising from 2.4% in October to 2.6%.
Deputy Governor Michael Atingi-Ego conveyed in a press conference that, despite the favorable outlook for both inflation and economic growth, maintaining the Central Bank Rate (CBR) unchanged is deemed necessary. This decision aims to secure inflation around the target in the medium term while concurrently fostering growth in private-sector investment.