Inflation drops for third month in a row
What you need to know:
- Food accounts for the highest percentage of household expenditures, thus a drop in inflation means that households spend less on goods and services
Inflation declined for the third month since August, boosted by a drop in the prices of most food crops and related items.
Data released by Uganda Bureau of Statistics at the weekend indicates that inflation dropped to 2.9 percent in October from 3 percent in September.
Food accounts for the highest percentage of household expenditures, especially in low-income countries such as Uganda, and a drop in inflation means that households are spending less on goods and services.
At the weekend, Ubos noted that food crops and related item inflation had dropped to -5.3 percent in October compared to 4.1 percent in September.
Mr Samuel Echoku, the Ubos head of macroeconomic statistics, said the drop in the prices of food crops was mainly due to a decline in the prices of cooking bananas, which dropped by -8 percent compared to 4.9 percent.
Additionally, he said, prices of tomatoes had dropped by -14.2 percent from -4.1 percent, while beans had dropped by -4.4 percent from -2.5 percent. However, Irish potato prices rose by 11.8 percent from 26 percent in September.
Mr Echoku also noted that inflation under energy fuel and utilities had reduced to 3.3 percent in October from 4.5 percent due to a drop in the prices of liquefied gas, which declined by -4.2 percent from 1.5 percent.
Charges on water supply reduced by 3.7 percent in October from 4.4 percent.
Ubos further indicated that prices of solid fuels had, however, increased by 15.5 percent from 14.3 percent, mainly due to charcoal prices that rose by 17 percent from 13.7 percent, but fire wood prices dropped by 13.3 percent compared to 16.6 percent.
Kampala high income registered the highest inflation of 4.4 percent up from 4 percent, followed by Mbarara, whose inflation rose to 4.2 percent from 3.9 percent in September, while in Masaka inflation declined to 3.1 percent from 3.5 percent.
In Arua, inflation dropped to 2.9 from 3.1, while in Jinja it declined to 2.1 percent down from 2.8, Fortportal (1.6 percent and in Gulu to 1.1 percent from 2.1 percent.
