Uganda’s Monetary Policy Committee will meet one month earlier than expected, the central bank said after the shilling fell to another record low.
The Bank of Uganda sold an unspecified amount of dollars in the foreign-exchange market Thursday to stabilize the currency and said it would meet on July 13 to “assess the current state of the economy and respond appropriately,” according to a statement e-mailed from the capital, Kampala.
The MPC, which usually meets every two months, raised its key rate by 100 basis points to 13 percent at its last meeting in June, citing accelerating inflation. That increase followed a similar increase in April. Inflation was steady at 4.9 percent in June, according to the Ugandan Bureau of Statistics.
The Ugandan shilling weakened 1.8 percent to 3,637.50 earlier on Thursday before retracing its losses and trading 2.4 percent stronger at 3,490 per dollar by 5:15 p.m. in Kampala. The currency has dropped 21 percent this year, Africa’s worst-performing currency after the Tanzanian shilling, according to data compiled by Bloomberg.
East Africa’s third-biggest economy, after Kenya and Tanzania, is on the cusp of becoming an oil producer, with companies including London-based Tullow Oil Plc, China National Offshore Oil Corp. and France’s Total SA developing the nation’s 6.5 billion barrels of oil resources.
Neighboring Kenya’s central bank raised its key rate by three percentage points in the past four weeks to check inflation.