Uganda’s inflation continues to drop, still lowest in region

Uganda’s inflation level continued slowing down in the month of September even as other countries in the region registered an upward trend.

Ramathan Ggoobi, the Secretary to the Treasury and Permanent Secretary in the finance ministry said the country was on track on track to full macro stability.

“For context, here is the regional situation: September inflation, Burundi 28.8% up from 26.1%, DRC 27.8% up from 26.7%, Rwanda 17.4% up from 17.3%, Kenya 6.8% up from 6.7%, Tanzania 3.3% maintained, and Uganda 2.7% down from 3.5%,” Ggoobi said.

Statistics indicate that annual Core Inflation slowed to 2.4% compared to the 3.3% figure in August.

According to economists, the slowdown in inflation for both consumers and policymakers implies that efforts to manage price hikes are bearing fruit.

This is in turn providing a more favourable environment for businesses and households to plan for their financial strategies.

Aliziki Lubega, the director of economic statistics at Uganda Bureau of Statistics, said: “When we say inflation is registered at 2.7%, it still means the prices are high. But the rate at which it is increasing on annual basis is slow.”

“For households and individuals, it means you must rationalize, know where you have to spend in areas required. There are commodities whose inflation has come down while others have increased,” the official told local media.

While addressing the second edition of the Uganda Economic Forum in August, Ggoobi said the country had managed to arrest inflation.

“Inflation has been arrested and the flow of exports and imports has remained smooth despite the global challenges,” Ggoobi said.

He added that the financial sector had remained stable and growing, adding that the government of Uganda was also responding to the risk of climate change.

To build the resilience of businesses to ensure continuity, Ggoobi suggested a number of strategies including, leveraging digital technology, embracing business insurance, transitioning into formal economy as well as structured capacity building for micro, small and medium enterprises development.

He said measures put in place by the government to support business recovery include; national business development services, small business recovery fund, Parish Development Fund, Emyooga skilling of the youth, funding through Uganda Development Bank plus support to SMEs and women businesses.

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