Uganda’s headline inflation for the 2024/25 financial year averaged 3.4%, reflecting moderate price growth amid sustained pressure from rising food and core service costs.
According to the Uganda Bureau of Statistics (UBOS), the increase was primarily driven by persistent food price hikes and a steady rise in service-related expenses.
The financial year closed with headline inflation at 3.9% in June 2025, slightly higher than the 3.8% recorded in May.
“The year’s average of 3.4% was shaped by persistent increases in food crop prices, a steady climb in core inflation, and mild price shifts in energy, fuel, and utility items,” said UBOS’s Samuel Echoku.
Food crop and related items exerted the most pressure, with annual inflation reaching 4.7% in June, up from 4.3% in May.
Prices of essential foodstuffs rose sharply throughout the year. Dry beans inflation climbed to 12.1% in June from 9.2% in May, while cooking bananas (matoke) surged to 37.7% from 29.8%.
Passion fruits rebounded from deflation, rising to 5.3% in June from -2.1% in May. Irish potatoes, though still deflationary, saw a smaller decline of -0.6% compared to -5.5% in May.
These persistent increases made food inflation a consistent driver of overall price growth during the fiscal year.
Core inflation, which excludes volatile food and energy items, remained steady at 4.2% in both May and June 2025. However, some service-related costs within the core category showed marked increases.
Outpatient care services rose sharply to 7.9% in June from 4.5% in May. Restaurant and accommodation services saw a slight rise to 4.7% from 4.6%.
Other core goods experienced marginal declines, with inflation easing to 3.7% in June from 3.8% in May.
Meanwhile, some staple items recorded notable annual increases. Sugar rose by 3.9% in June, reversing a 4.0% decline in May.
Rice prices climbed to 7.6% from 3.7%, while maize flour jumped to 12.6% from 7.4%.
Inflation for Energy, Fuel, and Utilities (EFU) remained negative for much of the year, ending June at -0.2%, up slightly from -0.9% in May.
Firewood inflation eased to 7.8% from 8.4%, while charcoal prices rose to 4.6% from 2.6%.
Petroleum products continued to record price declines, with petrol down -6.6%, diesel -4.7%, and liquefied gas -4.9% in June.
On a monthly basis, EFU inflation rose by 0.8% in June, mainly due to higher solid fuel prices.
Charcoal increased by 2.1%, firewood by 1.9%, and both petrol and diesel recorded modest gains.
Overall, Uganda’s monthly headline inflation dropped sharply to 0.1% in June, down from 0.5% in May, largely due to a steep fall in food crop inflation, which declined by -2.2% after rising 0.6% the previous month.
Key drivers of the monthly food price deflation included a -9.3% drop in cooking bananas, following a 9.6% rise in May.
Fresh beans plunged by -24.3% after a 15.3% increase in May. Mangoes fell by -12.8% from 16.2%, cabbage by -13.9% from -7.4%, and tomatoes declined by -4.2% from -9.3%.
Conversely, monthly core inflation rose by 0.3% in June, largely due to increases in service costs.
According to UBOS’s COICOP (Classification of Individual Consumption by Purpose) analysis, the divisions contributing most to the 3.9% annual inflation in June included housing, water, electricity, gas, and other fuels, which rose to 2.9% from 2.4%.
Recreation, sport, and culture increased to 2.8% from 1.9%, information and communication rose to 1.7% from 1.2%, and transport edged up to 2.9% from 2.7%.
Health services inflation rose to 4.6% from 4.4%, while restaurant and accommodation services climbed to 4.7% from 4.6%. Some categories, however, experienced slower inflation or outright declines.
Education services fell to 6.3% from 6.7%, furnishings and household equipment dropped to 1.8% from 2.7%, and personal care and miscellaneous goods slipped to 1.3% from 1.7%.
Despite sector-specific volatility, the FY2024/25 average inflation rate of 3.4% remained within the Bank of Uganda’s target range, indicating continued macroeconomic stability.
However, risks persist. Weather-related disruptions, food supply chain constraints, and rising service costs could shape future inflation trends.
As Uganda enters FY2025/26, policymakers are expected to keep a close watch on these developments, particularly amid ongoing economic recovery and uncertainty in global fuel markets.
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