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BoU More Likely To Stay Key Lending Rate At 10%-Analyst

The Bank of Uganda (BoU) Governor, Prof. Emmanuel Tumusiime-Mutebile will tomorrow Monday October 07, 2019 issue the Monetary Policy Statement for the month of October.

The BoU has for several months maintained the Central Bank Rate (CBR) at 10%.

 The CBR is a benchmark lending rate for commercial banks.

According to Stephen Kaboyo, an analyst and Managing Director at Alpha Capital Partners, BoU is most likely to jeep the CBR unchanged.

“The setting of the October CBR comes against a backdrop of fairly stable domestic economic conditions and continued optimism of good growth prospects. The month on month overall inflation has continued to decline, hitting a record low of 1.9% largely driven by lower food prices following improved supply, core inflation the mostly watched has also remained subdued, while the shilling has also held steady against the dollar,” says Kaboyo (pictured).

He adds: “The current domestic economic conditions provide scope for an accommodative policy stance in the near term. Although there are clouds of uncertainty hovering over the external environment that could easily increase volatility in the financial markets, all taken into account, BOU is likely to stay the course.”

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