Uganda Central Bank Holds Key Lending Rate at 6.5%

By Nicholas Bariyo

KAMPALA Uganda--Uganda's central bank held its benchmark lending rate at 6.5% on Thursday as the coffee-producing country steps up efforts to spur growth, after the economic disruptions caused by the surge of coronavirus infections

The central bank has kept the rate at record lows since mid-last year in an effort to boost an economy that is reeling from the effects of one of Africa's toughest lockdowns. Battered by Covid-19 containment measures, Uganda's economy contracted 1.1% during 2020 from growth of 6.8% the previous year.

"The Covid-19 restrictive measures will continue to weigh on economic activity," Emmanuel Tumusiime-Mutebile, central bank governor, said.

"In particular, between Covid-19 stops and starts, tourism is unlikely to return to normal levels any time soon," he said.

Write to Nicholas Bariyo at [e-mail]

(END) Dow Jones Newswires

08-12-21 0714ET