Despite slight increases in price of goods and services, Uganda’s inflation rate for the calendar year 2017 closed at 5.6 per cent. The rate is slightly different from that of 2016 that closed at 5.5 per cent. This indicated that the price of goods and services were relatively stable.
When inflation is low, consumers and businesses are able to make long-range plans because the purchasing power of their money will hold and won’t be steadily eroded.
Uganda’s inflation rate over the last three calendar years has been closing at a low rate. For instance, in 2015 inflation, closed at 5.4 per cent, indicating that Bank of Uganda (BoU)’s mission of maintaining price stability in Uganda’s economy is on course.
This is because the three calendar year inflation rate has been closing in within the range of BoU’s monetary policy target which aims at controlling the country’s inflation at 5 per cent.
Speaking during the release of the Consumer Price Index (CPI) for year ending December 2017 in Kampala last week, the principal statistician of price statistics at Uganda Bureau of Statistics (Ubos), Mr Vicente Nsubuga Musoke, said: “The annual average headline inflation for the calendar year 2017 was recorded at 5.6 per cent compared to 5.5 per cent recorded during the calendar year 2016. Annual average core inflation for the calendar year 2017 was recorded at 4.4 per cent from 5.9 per cent recorded during the calendar year ended 2016.”
Mr Musoke said Uganda’s inflation closed slightly higher than the previous year’s because of high prices of primary items such sugar and maize grain. This translated into high prices for complementary goods such as maize flour, meat, matooke, dry fruits, parking fees in Kampala city, increased electricity tariffs, increased meal charges in restaurants and high costs of imported fuel especially paraffin among other things.
Speaking about annual inflation which covers from December 2016 to December 2017, Mr Musoke said the annual headline inflation for the year ending December 2017 has been recorded at 3.3 per cent compared to the 4.0 per cent reported during the year ended November 2017.
“This represents a 0.7 per cent drop from that recorded during the year ended November 2017,” he said.