Uganda’s October inflation cools to 3.4% as food and transport prices ease

KAMPALA, October 2025 — Uganda’s inflationary pressures eased significantly in October, offering relief to consumers and signaling stabilizing conditions for businesses.

The Uganda Bureau of Statistics (UBOS) reported that Annual Headline Inflation, measured by the Consumer Price Index, fell to 3.4%, down from 4.0% in September 2025. Core Inflation, which strips out volatile food and energy items, mirrored the headline figure at 3.4%, indicating broad-based price stability.

Food Prices Lead the Decline

The deceleration was driven primarily by lower prices for essential food items. Inflation for Food Crops and Related Items slowed from 7.4% to 6.1%. UBOS highlighted sharp reductions in key staples: tomato prices moderated to 18.8% from 30.4%, while pineapple prices more than halved to 23.2%, down from 44.6%.

Core goods also contributed to the easing trend, with annual inflation in this sector falling to 2.6%, reflecting slower price growth for sugar (8.9% vs. 15.0% last month) and beef (11.6%). The combination of stable food and core goods prices signals an encouraging environment for households and retail businesses alike.

Transport and Services Bring Additional Relief

Consumers and enterprises benefited from a sharp reduction in transport costs. Annual Transport Inflation plunged to 1.0%, from 3.3% in September, supported by declining fuel prices, with petrol recording a negative 2.0% change. Services inflation also eased, falling to 4.5% from 5.1%, with Accommodation Services slowing to 3.2% from 4.2%. These trends reduce operational costs for businesses that rely heavily on logistics and service inputs.

Education and Urban Costs Remain Pressures

Despite the overall positive trajectory, inflationary pressures persist in specific sectors. Education Services saw annual inflation accelerate to 7.6%, up from 6.3% in September, creating cost pressures for households and businesses supporting education benefits. Geographically, the Kampala High Income group recorded the country’s highest annual inflation at 4.9%, largely driven by rising education costs.

Aliziki K. Lubega, representing the UBOS Executive Director, cautioned that “While the general decline in inflation is encouraging, structural inflation in sectors such as education and clothing demands close monitoring. The high inflation in Education Services for Kampala’s High Income group illustrates that price pressures remain concentrated in key urban sectors, even as food and transport stabilize.”

Outlook

The October data signals a welcome reprieve for Ugandan households and businesses, with easing food and transport costs improving purchasing power and lowering operational pressures. However, sector-specific inflation highlights the need for ongoing vigilance, particularly in urban centers and high-income brackets where service-related expenses continue to rise. Economists suggest that maintaining stable commodity prices, combined with targeted interventions in high-cost sectors, will be critical to sustaining the current inflationary gains.