Inflation rises again

Uganda's year-on-year inflation rate rose for the second straight month in December, the statistics office said on Monday.

The Uganda Bureau of Statistics (UBOS) said overall inflation rose to 5.5 percent in December from 4.9 percent a month earlier, while the core rate of inflation, which excludes food crops, fuel, electricity and metered water, climbed to 4.6 percent from a revised 3.9 percent.

Month-on-month inflation was 0.3 percent compared with 0.6 percent in November, it said.

"In the non-food category, (the month-on-month) price index rose by 1.5 percent. This was driven by increases in prices of alcoholic beverages, clothing, petrol, diesel, kerosene, firewood, transport fares and meals in restaurants," UBOS said in a statement.

Year-on-year food prices were unchanged in December having fallen 2 percent in November.

UBOS said the east African economy's average annual inflation rate for the 2012 calendar year was 14.0 pct compared with 18.7 percent for 2011.

Price pressures rose to an 18-year record high in October last year when headline inflation hit 30.5 percent. The central bank jacked up its key lending rate in the second half of 2011 and inflation fell steadily this year, also helped by easing food prices.

In early December, Uganda's central bank trimmed its key lending rate by 50 basis points to 12 percent, citing sluggish economic growth. The central bank has lopped a total 11 percentage points off its key rate this year. Reuters