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KAMPALA, UGANDA | THE INDEPENDENT | The Bank of Uganda has reduced the frequency of the review of the Central Bank Rate, to allow for more comprehensive economic analysis and enhanced forecasting accuracy.
This, the Bank says, will in turn enable the management to “build upon our established track record of effective policy decisions.”
The Monetary Policy Statement will now be issued quarterly starting February 25, instead of bi-monthly which has relatively been the norm for several years.
The Central Bank Rate which influences interest rates for regulated financial institutions will now be reviewed on February 6, May 8, August 7 and November 6 2025.
The CBR was last reviewed in December 2024 but held at 9.75 percent while inflation was 3.3 percent, according to the Uganda Bureau of Statistics.
Deputy Governor Michael Atingi-Ego says in a statement that this change will allow the Monetary Policy Committee to conduct more comprehensive economic analysis leveraging additional data to enhance forecasting accuracy and build upon its “established track record of effective policy decisions”.
He, however, says that this can change anytime if the Monetary Policy Committee deems it fit depending on the prevailing economic situation.
This is not the first time the Monetary Policy Committee is adjusting the CBR review frequency.
In 2011, the MPC issued policy statements monthly, and the then governor Emmanuel Tumusiime Mutebile vowed to raise the CBR for as long as the inflation rate kept spiralling.
The CBR was raised from 13 percent in July to 23 percent in November 2011 as inflation breached the 30 percent level for the first time in more than two decades.
BoU introduced the new monetary policy framework at the start of the previous year as an inflation-targeting lite framework, which was also being used in several advanced economies and emerging markets around the world.
The primary objective of monetary policy is to hold the annual rate of core inflation to 5 percent.
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