Uganda’s annual headline inflation slightly declined to 3.8% in July 2025, down from 3.9% in June, according to the latest Consumer Price Index (CPI) report released by the Uganda Bureau of Statistics (UBOS).
The drop was primarily attributed to falling food crop prices and easing inflation in the energy and utilities sector, reflecting a period of modest price stability in the country.
Core inflation, which excludes volatile food and energy prices, also dipped slightly to 4.1% from 4.2% in June, indicating that underlying inflationary pressures are gradually easing.
Monthly headline inflation registered a -0.1% change in July, compared to a 0.1% rise in June, pointing to a marginal reduction in average prices during the month.
Food crop and related item inflation was a key driver of the overall slowdown. Prices of tomatoes fell significantly by 9.0%, while dried beans and matooke also recorded decreases of 3.7% and 6.4%, respectively.
These declines followed already sharp drops in June, where matooke fell by 9.3% and tomatoes by 2.2%, suggesting improved market supply or reduced consumer demand.
Despite these drops, not all food items saw relief. Fresh leafy vegetables, for example, saw a sharp rise in annual inflation, climbing to 12.6% in July from 6.5% in June.
Maize flour inflation jumped to 13.8% in July, up from 12.6% the previous month. Sugar prices also surged, with an annual rise of 9.6%, up from 3.9% in June.
On the energy front, the annual Energy, Fuel and Utilities (EFU) inflation stood at 0.0% in July, a slight improvement from the -0.2% in June.
Electricity and liquid energy fuels such as gas saw modest price changes, but charcoal prices rose from 4.6% to 5.5%, and water charges by the National Water and Sewerage Corporation increased from 1.9% to 2.3%.
Monthly inflation in the services sector remained relatively stable. Restaurant and accommodation services inflation was unchanged at 0.2%, while financial services recorded a notable jump to 2.5% from 0.0% in June.
Other goods inflation, including items such as sugar, groundnuts, and maize grain, also contributed to upward pressure. Groundnut prices rose by 3.3%, while maize grain inflation soared by 7.0% in July.
Regionally, Masaka recorded the highest annual inflation among all geographical CPI centers, at 5.1% in July (though down from 5.4% in June), driven largely by transport and health-related inflation.
In Kampala High Income areas, annual inflation stood at 4.9%, slightly higher than the 4.8% recorded the previous month. Mbale posted the lowest annual inflation at just 0.2%, down from 0.7%.
Sector-specific drivers continued to show varied patterns. Transport inflation rebounded from -0.2% in June to 1.7% in July, while health inflation accelerated from 4.3% to 5.8%.
Restaurants and accommodation services also became more expensive, with annual inflation increasing from 3.2% to 4.2%.
In contrast, the housing, water, electricity, gas, and other fuels category recorded a slowdown in annual inflation, dropping from 6.5% to 4.3%.
Overall, the July 2025 inflation figures point to a generally easing inflationary environment, although key commodity groups such as maize, sugar, and fresh vegetables remain under price pressure.
The moderation in core inflation and energy prices is a welcome signal for policymakers, businesses, and consumers alike.
However, the volatility in food prices especially for staple items means households may continue to feel uneven impacts depending on their consumption patterns.
As Uganda continues to implement its economic recovery strategy under the National Development Plan IV (NDP IV), stable inflation will be crucial in supporting household purchasing power and encouraging private sector investment.
The UBOS figures offer cautious optimism that inflation may remain within the Bank of Uganda’s target range in the coming months, barring external shocks or supply disruptions.
With inflation slightly easing and the currency relatively stable, focus is now shifting toward long-term structural reforms in agriculture, logistics, and energy sectors to reduce supply-side vulnerabilities that continue to affect price stability across Uganda.