Uganda’s annual Inflation for October has dropped to 4.8% compared to 5.3 % recorded in September 2017.
Releasing a monthly inflation performance report, Uganda Bureau of Statistics director Macroeconomic statistics Chris Mukiza attributed the drop to a decrease in annual core inflation which recorded at 3.5% compared to 4.2% last month.
The bureau said noted that the annual food crops inflation declined from 9.6% to 7.8 % in October 2017.
Mr. Mukuza said that Fort Portal registered the highest Inflation rate of 8.1%, followed by Gulu standing at 7.0%.
According to bureau, nnual energy, fuels, and utilities inflation rose by 14.1%, higher than September’s 10.6% increase. “This was due to annual inflation for solid fuels (charcoal and firewood) that increased to 25.0% for the year ending October 2017 compared to 15.0% recorded for the year ended September 2017,” Ubos said. “However, liquid energy fuels inflation declined to 5.3% for the year ending October 2017 compared to 5.5% recorded in September 2017.”
On a monthly basis, headline inflation increased by 0.3%, slower than September’s 1.0% rise. Energy, fuel and utilities inflation rose 1.8% versus 3.7% in September, while the prices of food crops and related items increased by 0.2% compared to the 4.6% rise in September. Core inflation was 0.2%, slightly higher than the 0.1% in the past month.
Inflation is an increase in prices, which affects the economy by reducing the purchasing power of consumers, causing companies to earn less revenue.
Inflation also increases the rate of unemployment because it leads rising wage demand which at times companies are not ready to pay.
High inflation rate also has a regressive effect on lower-income families and older people in society.
This happens when prices for food and domestic utilities such as water and electricity rise at a rapid rate. It also affects both high and low income earners inform of a fall in real income.