Uganda Central Bank cuts rate for second time as inflation outlook improves

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Borrowers in Uganda are anticipating cheaper loans after the Central Bank cut its prime lending rates for the second time this year.

Bank of Uganda has reduced the benchmark-lending rate to 15 per cent responding to an improvement in the country’s inflation outlook. The bank says the latest monetary policy decision is aimed at stimulating economic activity.

In April the Central Bank made a surprise cut, lowering the rate to 16 percent from 17 percent, saying it needed to boost growth.

Bank of Uganda says the economy will continue to grow at a moderate pace and is projected to expand by 4.6% down from an earlier projection of 5%, mainly attributed to the weak global economic environment, soft commodity prices, and tight financial conditions.

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