The central bank of Uganda has lowered the central bank rate from 19% in July to 17% in August following a sharp reduction in core inflation during the month of July, said Emmanuel Tumusiime Mutebile, the bank’s governor at a monthly press briefing in Kampala on August 2.
Both headline and core inflation rates fell sharply in July, to 14.3% and 15.4% respectively compared to 18.0% and 19.6% respectively in the previous month.
The governor said, following the recent trends in the economy that is, the weakness of real output, the stability of the nominal exchange rate and the decline in global commodity prices, the bank revised its forecast of inflation downwards for the rest of 2012.
Annual core inflation is expected to fall to single digits by the end of the third quarter of the calendar year 2012 and then fall to approximately 7% by the end of the calendar year before reducing to around 5% in the first half of 2013.
Mutebile said he expected commercial banks to reduce interest rates in line with the changes in the CBR. “This is a free market,” he said adding, but I think they will respond accordingly.
Commercial banks increased lending rates to over 30% in the past six months but started reducing to the current around 25% when the central bank started easing monetary policy.
written by Louis vuitton Sale, August 11, 2012
written by Louis Vuitton Bags, August 18, 2012