The Bank of Uganda (BoU) has maintained its Central Bank Rate (CBR) unchanged at 9.75% for the third consecutive time, citing persistent global economic uncertainty and the need to maintain price stability.
The Bank of Uganda’s Governor Michael Atingi-Ego said the Monetary Policy Committee (MPC) considered the current policy stance appropriate to maintain inflation within the target while supporting sustainable economic growth.
“In light of the prevailing domestic and global uncertainties and the elevated risks to the inflation outlook, the MPC decided to maintain the Central Bank Rate,” Atingi-Ego said.
In its Monetary Policy Statement for May 2025, the central bank said the decision reflects a cautious stance aimed at balancing the country’s growth trajectory with inflation management, as external risks remain elevated.
The central bank also maintained the rediscount rate at 12.75% and the bank rate at 13.75%, consistent with the existing CBR bands of ±2 percentage points and 3–4 percentage points, respectively.
According to the Bank, the growth outlook for FY2024/25 remains at 6.0–6.5%, with potential to reach 7.0% in the coming years. This forecast is underpinned by improved agricultural and industrial activity, increased investment in the extractive sector, and ongoing government initiatives such as the Parish Development Model (PDM).
For the BoU, holding the rate steady signals policy credibility and a commitment to macroeconomic stability. It allows the Bank to monitor how past decisions are affecting the broader economy and provides flexibility to respond to shocks without fueling volatility.
“This decision helps anchor inflation expectations, keeping prices relatively stable.This benefits Ugandans, especially low- and middle-income households, by preserving the purchasing power of their income,” Atingi-Ego said.
Uganda’s inflation remains subdued, with headline inflation averaging 3.4% and core inflation at 3.9% over the past year—both below the Bank’s medium-term target of 5%. The BoU attributes this to prudent monetary policy, a stable exchange rate, global disinflation, and favorable food and energy prices.
The move is expected to reassure investors and market participants that Uganda’s monetary policy framework remains predictable and responsive amid global economic uncertainty.
