Bank of Uganda Slashes Benchmark Rate amid shrinking growth

KAMPALA (Capital Markets in Africa) – The Bank of Uganda on Wednesday lowered the central bank rate by 50 basis points from 12 percent, set in December 2016, to 11.5 percent. The cut was necessary to “support economic activity”, according to the Monetary Policy Statement for February 2017.

It is the sixth consecutive cut since the central bank started easing the policy rate in April 2016.

“A further cautious easing of monetary policy is warranted to support economic activity,” Bank of Uganda Governor Emmanuel Tumusiime-Mutebile told reporters Wednesday in the capital, Kampala. “The easing will also be consistent with achieving the annual core inflation target of 5 percent over the medium term.” ,

The central bank also reduced the rediscount and the bank rate to 15.5 percent and 16.5 percent respectively. Tumusiime-Mutebile stated.