Economy to Stabilize in Two Months — Mutebile
By Serestino Tusingwire
The governor Bank of Uganda Emanuel Tumusiime Mutebile has promised to ensure recovery of the country’s economy within a period of two months.
Uganda has been in a severe economic turbulence since the election period in February this year.
According to the December Monetary Policy Statement, annual inflation rose to 4.6 % in November from 4.1% in October.
Mutebile however blames this to famine which has largely increased food inflation from 1.7% to 7.1% in November.
Addressing the media yesterday, Mutebire explained that consequentially, the bank of Uganda has decided to cut the Central Bank rate by 1% point to 12%, and the margin on rediscount rate at 4% point on the central bank rate.
He further said that although many people are feeling the economic pinch due to the inflation triggered by the drought, the situation is likely to change when the rainy season sets in.
The confusing Mutebile however said that if prices on food crop and fuel fail to reduce, inflation will last for over 12 months.
“We forecast inflation to be higher due to the rise in food crops and fuel prices. We expect it decline in the next 12 months.”