Standard Chartered Bank Uganda ltd says it expected Bank of Uganda to opt for a more gradual pace of easing than it did on August 2.
The Central Bank reduced the central bank rate to 17% in August down from 19% in July after headline inflation reduced to 14.3% in July from 18.0% in June.
BoU now expects that core inflation will fall to single digits as early as Q3 2012.
Stanchart said in a statement released on August 2 that it anticipates a further dramatic improvement in inflation over the coming months – largely on the back of a high base from last year, although clearly two consecutive months of falling food prices regionally also seem to have helped.
“With headline inflation set to fall to single digits by the end of Q3 2012, in our view, the risk of further aggressive interest rate easing by the BoU remains,” the bank said, adding however, we question whether this is necessarily the correct response to current conditions.
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written by William, August 07, 2012
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written by Louis Vuitton Bags, August 18, 2012
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