Uganda’s March inflation eases to 2.8% despite rising fuel costs

KAMPALA, Uganda – Uganda’s annual headline inflation for the 12 months ending March 2026 has edged down slightly to 2.8 percent, a modest decrease from the 2.9 percent recorded in February 2026. While overall price increases are slowing, a sharp rise in energy and fuel costs continues to put pressure on households and businesses across the country.

The latest figures, released by the Uganda Bureau of Statistics (UBOS), show that the slight cooling of inflation is primarily due to a slowdown in price increases for food crops and services.

“The Annual Inflation as measured by the Consumer Price Index for Uganda for the 12 months to March 2026 is 2.8 percent compared to 2.9 percent registered in the year ended February 2026,” stated Dr. Chris N. Mukiza, the Executive Director and Chief Statistician at UBOS.

Core and Food Inflation Trends

Annual core inflation, which excludes volatile items like food and energy, also saw a marginal dip, registering at 2.9 percent in March 2026 compared to 3.0 percent in February. This trend was supported by a decrease in services inflation, particularly in the hospitality sector. Restaurants and accommodation services inflation fell to 3.7 percent from the 4.0 percent recorded the previous month.

Food crop inflation followed a similar downward trajectory, dropping to 1.0 percent from 1.8 percent in February. Consumers saw relief in the prices of several key items, with fresh milk prices dropping by 4.0 percent and pineapples seeing a 0.7 percent decrease compared to the previous year.

The Energy and Fuel Surge

Despite the overall cooling, the Energy, Fuel, and Utilities (EFU) sector remains a significant concern. Annual EFU inflation surged to 4.1 percent in March 2026, up from 2.7 percent in February.

The primary drivers of this spike were solid fuels, such as charcoal and firewood. Firewood inflation reached a staggering 16.2 percent, while charcoal prices rose by 8.1 percent. Liquid energy fuels also contributed to the rise, with petrol and diesel inflation climbing to 4.4 percent and 3.0 percent, respectively.

On a monthly basis, the headline inflation increased by a slim 0.1 percent from February to March 2026. This was largely driven by a 1.0 percent jump in monthly EFU inflation. Specific items like watermelons saw a dramatic monthly price increase of 12.9 percent, while tomato and Irish potato prices rose by 6.6 percent and 5.2 percent, respectively.

Regional Variations

A geographical analysis shows that Masaka registered the highest inflation rate in the country at 3.6 percent, driven largely by increases in health and housing costs. In contrast, Arua recorded the lowest annual inflation at 0.9 percent, aided by a decrease in the prices of food and clothing.

In the capital, Kampala High Income areas saw inflation at 3.3 percent, while Kampala Low Income and Middle Income areas recorded rates of 3.2 percent and 2.7 percent, respectively.

As the country navigates these mixed economic signals, the rise in energy and fuel costs remains a critical factor for policymakers and the public alike, even as food prices offer some reprieve.