Uganda Inflation Hits Three-Year High of 5.8 Percent

Uganda's inflation rate reached a three-year high of 5.8 percent in October, rising from 4.6 percent in September. The Uganda Bureau of Statistics attributed the spike primarily to a surge in food inflation, which jumped from 4.5 percent to 10.7 percent, alongside increasing oil prices.

This economic pressure follows a sharp decline in the Ugandan shilling, which has fallen nearly 15 percent against the U.S. dollar since June. As of October 30, the currency was trading at approximately 4,245 per dollar.

In response to the currency slump and rising inflation, the Bank of Uganda implemented an emergency interest rate hike earlier in the month, raising the policy rate from 9.75 percent to 12 percent. The central bank also increased banks' reserves ratios and intervened in the foreign exchange market to curb the demand for dollars.