Reuters
Uganda’s central bank on Monday held its benchmark lending rate at 10
percent for the third time in a row, the bank’s governor said, citing
economic activity which is close to potential.
Policy-makers raised rates for the first time in three years last
October over concerns about rising inflationary pressures. They
subsequently left them unchanged at their December and February
meetings.
“The economy is projected to be operating around its potential economic
growth of 6-6.5 percent,” Governor Emmanuel Tumusiime-Mutebile told a
news conference.
The robust expansion was driven by improved output in the crucial
farming sector, higher growth in government consumption and increased
private investments, he said.
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But
he reiterated concerns about the potential impact of growing trade
protectionism around the world, which could dampen demand for Ugandan
goods and services at home and abroad.
“Downward risks to the projected economic growth momentum have increased
since the previous round of forecasts,” Tumusiime-Mutebiile said.
“The risks largely revolve around unresolved trade tensions which are affecting... investment activities.”
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