MARKET PERFORMANCE IN AUGUST 2020

ECONOMIC & FINANCIAL DEVELOPMENTS: INFLATION – OUTLOOK AND RISKS
Annual Headline inflation fell to 4.6 percent in the 12 months to August 2020 compared to 4.7 percent in the year to July 2020. According to the Uganda Bureau of Statistics (UBOS), this decline was a result of a reduction in annual Electricity, Fuel and Utilities inflation. Annual Electricity, Fuel and Utilities inflation dropped to 4.3 percent in August 2020 from 6.6 percent in July 2020. Year on year core inflation rose to 5.9 percent in the 12 months to August 2020 from 5.8 percent registered in July 2020 driven by higher services inflation due to higher transport costs. Annual food crops and related items inflation increased to a deflation of 5.4 percent in the 12 months to August 2020 compared to a deflation of 5.5 percent in the year to July 2020 due to higher prices of fruits. Monthly headline inflation increased by 0.3 percent in August 2020 from a 0.1 percent increment registered in July 2020 due to higher food prices. Inflation is expected to edge higher due to increased food prices as the harvest season concludes. Furthermore, higher input prices driven by increased transport costs present a risk of higher inflation...

For more how the market performed in August 2020, please view attachment below.