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Reduction in mobile money charges sees inflation drop to 3.5 percent
A decline in mobile money charges saw financial services inflation drop during August. Photo / File
What you need to know:
- During August, mobile money inflation reduced to 10.8 percent from 13.4 percent
A slight decline in mobile money (sending) charges resulted in a drop in inflation to 3.5 percent from 4 percent in July, Uganda Bureau of Statistics (Ubos) says.
During August, according to Ubos, mobile money inflation reduced to 10.8 percent from 13.4 percent, which, Mr Samuel Echoku, the Ubos head of macroeconomic statistics, said saw a reduction in financial services inflation to 4.3 percent from 5 percent.
Mobile money has become the cheapest means of money transfer but continues to face cost challenges such as tax and other associated fees.
Mr Echoku said despite a slight decline, service costs continued to be the main drivers of inflation. Services inflation dropped to 6.2 percent from 6.5 percent.
Passenger transport service inflation reduced to 6.9 percent from 8.2 percent, while food and beverage services inflation reduced to 2.7 percent from 3.8 percent in July.
Other contributing factors included rice, which registered a -5 percent inflation in August compared to -10.1 percent, while maize flour inflation stood at -24.5 percent from -26.1 percent.
Food-related products have registered stable prices in the past few months, with food crops and related items inflation dropping to -0.6 percent from 2 percent.
The drop, according to Mr Echoku, was mainly due to a decline in the prices of round onions (by -25.5 percent compared to 29.6 percent in July), matooke by -2.1 percent from 3.6 percent and fresh cassava by -27 percent from -21.0 percent in July, while cabbages dropped by 20 percent from 32.5 percent.
Ubos also noted that energy, fuel, and utilities prices slightly reduced with energy fuel and utility inflation reducing to 4.7 percent compared to 6.2 percent in July.
This was mainly due to liquid energy fuels inflation, which reduced to 3.8 percent from 5.1 percent, largely due to a decline in the prices of petrol and diesel, while solid fuels inflation decreased to 9.4 percent in August compared to 13.3 percent in July due to reduction in the prices of charcoal and firewood.
Kampala high income registered the highest inflation of 4.8 percent, followed by Mbarara with 4 percent, while Mbale at 1.4 percent registered the lowest.
