Uganda’s consumer price growth slows in August

Uganda’s consumer price growth slowed for the second straight month in August thanks to lower core inflation and food prices, bringing the annual inflation rate to its lowest level since June 2018.

The annual headline inflation rate fell to 2.1% from 2.6% in July, the Uganda Bureau of Statistics said on Friday. This was largely due to a decline in core inflation — which excludes volatile agricultural and energy prices — to a 13-month low of 2.7%, down from 3.5% year on year the previous month.

Ubos said the slower growth in core consumer prices was a result of a fall in annual other goods inflation, particularly the 12-month clothing and footwear inflation rate which came in at 4.6% compared to 5.4% in July. In addition, sugar inflation fell 13.4% year on year in August, while service inflation also declined.

Food crops and related items inflation fell 1.4% from a year earlier compared to a decline of 0.8% in July, largely due to a decline in the prices of vegetables. Energy inflation rose 1.0% year on year, its highest rate in three months, down from a decline of 1.9% in July, mainly as a result of an increase in charcoal prices.

The monthly headline inflation rate for August rose 0.4% compared to a similar drop recorded in July 2019. This was attributed to an increase in food crops and related items inflation of 1.1% versus a decline of 4.2% the previous month. Core inflation increased by 0.1%, up from 0.0% in July, while energy, fuel and utilities prices rose 1.9% versus an increase of 0.5% in July.