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Bank of Uganda maintains CBR at 12%

By Julius Businge

The Bank of Uganda has for the fourth consecutive month maintained the Central Bank Rate (CBR) at 12% in March, according to the Monetary Policy Statement issued by the bank on March 5.

The Bank said inflationary pressures have remained below single digits and that meant maintaining the rate at 12% was a good option.

The Uganda Bureau of Statistics announced last week that Uganda’s annual headline inflation had dropped to 3.4% for the year ended February 2013 down from 4.9% a year earlier.

Responding to BoU’s decision of maintaining the CBR at 12%, Razia Khan, the Regional Head of Research, Africa at Standard Chartered Bank said the decision was not surprising.

“Bank of Uganda is correct to focus on the outlook for inflation, rather than past inflation in formulating its decision,” Khan said.

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