Inflation hits 6.8% in April

Year-on-year headline inflation has hit 6.8% at the end of April from 6.4% in March on the back of higher vegetable prices, the Uganda Bureau of Statistics (UBOS) said on Friday.

Core inflation, a component of overall headline inflation which strips out food, fuel, metered water and electricity prices hit 4.9% from 4.7% after most parts of Uganda experienced a prolonged drought from 2016, affecting food prices in most markets.

Alpha Capital Partners' Stephen Kaboyo noted that there is a general underlying trend of building cost pressures that are feeding through from the harsh weather conditions in the early part of the year.

"In my view, this supply shock is the main factor behind the upward trend. On the positive side the shilling stability seen in the last couple of months seems to be moderating the effects, however depreciation pressures are lately showing up again considering the currency movements of this week," Kaboyo said.