Market News

KAMPALA, Oct 30 (Reuters) – Uganda’s inflation rate rose to a 3-year high of 5.8%, the country’s statistics office said on Friday, a move that follows a sharp slump in its shilling currency in recent months and a jump in oil and food prices.

The year-on-year rise in October’s consumer price data compared with a 4.6% rate the previous month. It marked the fastest pace of inflation since June 2023 when the spike in energy prices following the COVID-19 pandemic and Russia’s invasion of Ukraine was still receding.

The shilling is down almost 15% against the dollar since June. It was trading at around 4,245 per dollar on Friday from 3,614.50 at the end of 2025.

Details of Friday’s inflation figures attributed much of the rise to a steep surge in food inflation, which jumped to 10.7% in October, from 4.5% in September.

The shilling’s sharp fall prompted an emergency hike in interest rates from Uganda’s central bank earlier this month to try to stem soaring local demand for dollars.

It raised its policy rate to 12% from 9.75%, saying the hike was needed to curb rising inflation pressures. It raised banks’ reserves ratio as well to try to provide additional support, while local traders say it has also intervened in the FX market.