Uganda’s central bank kept its Central Bank Rate (CBR) steady at 12.0 percent for the fourth month in a row, saying upside inflationary risks had risen slightly but economic growth was below potential, credit growth was weak and the exchange rate stronger, factors that mitigate inflationary pressures.
The Bank of Uganda (BOU), which cut its CBR rate by 1100 basis points last year as inflation eased, said its forecast for “annual core inflation over the next 12-18 months remains largely unchanged at around 5 percent, though the upside risks have increased somewhat.”
Uganda’s headline inflation rate eased to 3.4 percent in February from January’s 4.9 percent due to lower food prices and annual core inflation was largely flat at 5.5 percent from January’s 5.6 percent.
“The monthly core inflation, however, accelerated, pointing to a buildup of core inflationary pressures that may need to be checked, if sustained,” the BOU said in a statement.
The central bank targets annual inflation of around 5 percent.
The BOU said growth in monetary aggregates continued to recover at a modest rate but shilling-denomined loans to the private sector remained stagnant due to high lending rates and the difficulties facing companies.
“Although real output is still below potential, real GDP growth is projected to gradually recover in 2013 and 2014; a projection which is supported by recent trends in the Composite Index of Economic Activity, that point to signs of increased buoyancy in the economy,” the bank added.
Uganda’s Gross Domestic Product expanded by 1.8 percent in the third quarter of 2012 from the second quarter for annual growth of 2.8 percent, down from 3.2 percent in the second quarter.
|COUNTRY||MSCI||NEW RATE||OLD RATE||1 YEAR AGO|
|TRINIDAD & TOBAGO||2.75%||2.75%||3.00%|
|COUNTRY||MSCI||MEETING||RATE||1 YEAR AGO|
The Central Bank of the Dominican Republic (CBDR) kept its Monetary Policy Reference (MPR) rate steady at 5.0 percent as inflation is forecast to be within the bank’s target this year and next and economic growth is also in line with expectations.
The CBDR, which cut its rate by 175 basis points in 2012 but also left the rate unchanged last month, said the domestic economy expanded by 3.9 percent last year, higher than the average in Latin America and liquidity in international financial markets was good, which could help the flow of capital to emerging economies. In 2011 the Dominican Republic’s economy grew by 4.5 percent.
“Credit to the private sector in the national currency continues to show a recovery and projections suggest that by the end of the year the funding would grow faster than nominal GDP,” the central bank said, adding that higher credit would allow faster recovery in consumption and private investment.
Inflation in the Dominican Republic rose to by a monthly 1.26 percent in January to an annual rate of 4.76 percent, up from December’s 3.9 percent, due to the impact of tax reform, the bank said.
The CBDR targets inflation of 5.0 percent, plus/minus one percentage point in 2013 and 4.5 percent, plus/minus one percentage point, in 2014.