The Bank of Uganda (BoU) has maintained the Central Bank Rate (CBR) at 9.75 percent, saying the current policy stance remains appropriate to support economic activity while keeping inflation under control.

In its February 2026 Monetary Policy Statement, the Monetary Policy Committee (MPC) noted that inflation continues to remain below the medium-term target of 5 percent. Over the year to January 2026, headline inflation averaged 3.5 percent, while core inflation averaged 3.8 percent, supported by a stable exchange rate, easing global inflation, and favourable food and energy prices.

Headline inflation rose slightly to 3.2 percent in January from 3.1 percent in December, largely driven by higher services inflation, particularly passenger air transport. Core inflation also edged up to 3.3 percent, while food crop inflation eased to 3.0 percent from 4.4 percent due to favourable weather conditions. Energy, Fuel and Utilities inflation increased marginally to 1.7 percent, reflecting modest firewood price increases.

The central bank revised its inflation outlook slightly downward, projecting inflation to remain below target in 2026, within a range of 3.8 to 4.3 percent, before stabilising over the medium to long term.

Uganda’s economy grew by an average of 6.3 percent in the first three quarters of 2025, driven mainly by strong final consumption, particularly government spending. Economic growth for FY2025/26 is projected at between 6.5 and 7.0 percent, with medium-term growth expected to strengthen further to about 8 percent, supported by public investment, oil-related developments, infrastructure expansion, and private sector activity.

However, the MPC cautioned that risks to both inflation and growth remain elevated due to global geopolitical tensions, fiscal pressures, exchange rate movements, and weather-related shocks.

Against this backdrop of heightened uncertainty, the MPC opted to keep the policy rate unchanged. The CBR corridor remains at ±2 percentage points, with the rediscount rate at 12.75 percent and the bank rate at 13.75 percent. The central bank said future policy decisions will remain data-dependent.