The Bank of Uganda held its Central Bank Rate (CBR) at 12 percent on Monday, 9 November 2026, and cut its growth forecast for the 2026/27 financial year to 5.5 to 6.0 percent from 6.0 to 6.5 percent. The Monetary Policy Committee (MPC) also widened the band around the CBR to plus or minus 3 percentage points from plus or minus 2.
This decision follows a special meeting on 14 October, where the MPC raised the rate by 225 basis points from 9.75 percent. The statement says the hold gives “sufficient time for the effects of previous policy measures to work through the economy.”
Governor Michael Atingi-Ego signed the statement. The MPC judged that “the current financial conditions are tight enough notwithstanding the continuing uncertainty.” It described the tightening as temporary and said: “The Bank of Uganda remains steadfast in its commitment to maintaining price stability.”
Band widens and lending benchmarks rise
The MPC said widening the band “was warranted to support tight shilling liquidity.” The rediscount rate and the bank rate now sit 4 and 5 percentage points above the CBR, at 16 and 17 percent. In February they stood at 12.75 and 13.75 percent. Both rates set what commercial banks pay to borrow from the central bank.
Inflation rises on energy prices and the shilling
The statement says: “Inflation has edged up, and several upside risks have materialised since the October 2026 MPC meeting.” Headline inflation rose to 5.8 percent in October from 4.6 percent in September. Core inflation rose to 4.4 percent from 3.7 percent. The Bank said shilling depreciation and higher global energy prices from the Middle East conflict “have added to inflationary pressures.” Average inflation over the 12 months to October stayed below the 5 percent target, at 3.6 percent for headline and 3.3 percent for core.
Forecasts rise above the 5 percent target
Over the next 12 months the Bank expects headline inflation to average 7.5 to 8.0 percent and core inflation 6.0 to 6.5 percent. It cites higher oil prices, a wider current account deficit and slower portfolio inflows. The statement says: “The risks to the inflation outlook remain skewed to the upside.” It adds that “Should oil prices decline, inflation momentum could wane much faster than currently projected.”
Growth slows to an estimated 5.3 percent
The statement says: “Economic growth remains resilient, but early indicators point to softening.” The Bank estimates growth moderated to about 5.3 percent in the quarter to September, against the 6.8 percent the Uganda Bureau of Statistics (UBOS) reported for the quarter to June. Earlier in the year it projected 7.0 to 7.5 percent for FY2026/27. It blames tighter financial conditions, the depreciation and elevated energy prices.
Downside risks include tight shilling liquidity that could limit private sector credit, El Niño weather and oil production delays. Over five years the Bank expects growth to average about 8 percent, supported by private investment, exports, oil sector developments and the Tenfold Growth Strategy.
Policy rate, inflation and shilling month by month
Inflation is the annual rate UBOS reports. Shilling figures are monthly averages unless marked spot.
| Month | CBR (percent) | Headline (percent) | Core (percent) | Shilling per dollar |
|---|---|---|---|---|
| January | 9.75 | 3.2 | 3.3 | 3,562 |
| February | 9.75 | 2.9 | 3.0 | 3,568 |
| March | 9.75 | 2.8 | 2.9 | 3,731 |
| April | 9.75 | 3.0 | 3.0 | 3,717 |
| May | 9.75 | 3.2 | 3.0 | 3,765 |
| June | 9.75 | 3.7 | 3.4 | 3,711 |
| July | 9.75 | 4.0 | 3.4 | 3,710 |
| August | 9.75 | 4.1 | 3.5 | 3,730 |
| September | 9.75 | 4.6 | 3.7 | 3,869 |
| October | 12.0 | 5.8 | 4.4 | 4,024 |
Headline inflation rose 2.6 percentage points between January and October and core inflation rose 1.1 points. The shilling opened 2026 at about Shs3,623 to the dollar and closed above Shs4,000 for the first time on 5 October. On 2 November it traded between Shs4,275 and Shs4,285.
