Uganda: Rising Food Prices Force Increase in Inflation

Food and non-alcoholic beverages prices picked up in the period ended July, resulting in an increase in headline inflation for the 12 months running to July.

During the period, according to Uganda Bureau of Statistics (Ubos), headline inflation slightly increased, rising to 2.1 per cent up from 2 per cent in June.

The increase was due to annual food and non-alcoholic beverages inflation, which rose to 0.7 per cent in July compared to – 1.6 per cent in June.

Inflation for restaurants and accommodation services increased to 1.3 per cent in July from 0.2 per cent while housing, water, electricity, gas and other fuels inflation increased to – 0.9 per cent from – 1.5 per cent during the period.

Transport inflation dropped to 10.7 per cent down from 15.9 per cent in June 2021, mainly due to 42-day lockdown on both private and public transport, which was eased last Friday.

During the period, Ubos noted that inflation for information and communication decreased to – 1.4 down from 0.9 per cent while alcoholic beverages, tobacco and narcotics inflation decreased to 1.3 per cent in July down from 1.6 per cent in June.

Core inflation, which excludes movements in the food and energy sectors, decreased to 2.5 per cent down from 2.7 per cent in June due to annual services inflation, which decreased to – 0.1 per cent down from 1.4 per cent.

Other goods inflation for the 12 months to July increased to 0.4 per cent up from – 0.1 per cent while non-core inflation for the period increased to 0.05 per cent up from – 2.1 per cent due to an increase in food crops and related items inflation, which increased to 0.9 per cent from – 2.8 per cent.