Uganda Tightens Monetary Policy Amid Global Pressures

Governor Michael Atingi-Ego announced a decision during a special session on October 14, signaling a stricter monetary policy approach to manage price pressures linked to the escalating conflict in the Middle East.

Atingi-Ego emphasized that geopolitical tensions in the Middle East have disrupted shipping routes and energy infrastructure, leading to higher global oil prices, increased freight and insurance costs, and financial market uncertainty.

The governor noted that these developments have intensified depreciation pressures on the shilling, raised import costs, and increased the risk of higher fuel and transport costs spreading to other goods and services.

Global economic pressures, including rising oil prices, a weakening shilling, and potential El Niño impacts on food supplies, could push inflation higher in Uganda, according to Atingi-Ego.