KAMPALA (Reuters) – Uganda’s finance ministry said on Friday it had lowered its economic growth forecast to 5.3%, down from 6.0%, for the 2022/23 financial year because of a slowing global economy, a spike in inflation and adverse weather.
The east African country’s economy expanded by 4.7% in the year that ended in June.
There were indications the economy was on a firm path to recovery after the impact of the coronavirus lockdowns, the ministry said in a statement.
In recent months Uganda has seen a surge in inflation pressures, fuelled by higher food costs and energy prices.
Year-on-year inflation jumped to 10% last month from 9% in the preceding month, far higher than the authorities’ target of 5%.
In response the central bank has tightened its monetary policy stance, hiking its benchmark rate by a total of 3.5% so far this year to tame inflation.
(Reporting by Elias Biryabarema; Editing by Hereward Holland)
