The central bank will on Monday next week issue its monetary policy for December and January 2018, where it will announce the indicative lending rate for commercial banks.
Governor Emmanuel Tumusiime-Mutebile, a veteran economist, will announce the new Central Bank Rate (CBR) after a Monetary Policy Committee (MPC) meeting of the central bank.
The rate, to be announced to journalists on Monday at midday, will guide lenders on the best rates. At the moment rate stands at 9.5%, the lowest level since a high of 23% in December 2011.
The CBR was introduced in December 2011 after a chaotic poll that saw inflation surge above 30% — the highest level in decades — and it has helped lower that over the years.
Economists said they do not expect a new revision after an aggressive round that saw the CBR fall phenomenally. They cite the coming Christmas season where spending is so high, emphasizing inflation rises a little bit.
Last month, the Uganda Bureau of Statistics (UBOS) said inflation eased in November to a new low of 4 percent, down from 4.8 percent in October.
Meanwhile, banks have since responded by lowering their lending rates, although economists say they should do more. Stanbic, the largest lender by assets, gives its best customers loans at 19.5% per annum, the country’s lowest.
