Petrol price down 0.2% in June

According to data from the Uganda Bureau of Statistics (UBOS), petrol prices dropped by 0.2 percent compared to a 0.5 percent increase recorded in May 2024.

This was revealed by Edgar Niyimpa, the principal statistician at UBOS, during the release of the Consumer Price Index (CPI) today at the Statistics House in Kampala.

The decrease in petrol prices is part of a broader trend of declining fuel costs.

Diesel prices, for instance, registered a notable decrease of 1.2 percent, down from a 1.3 percent increase in the previous month.

Similarly, liquefied gas prices saw a reduction of 1.6 percent. This decline in fuel prices is significant as it comes amidst fluctuating global oil prices and economic uncertainties.

"June's reduction in fuel prices offers some respite for consumers and businesses alike," said Niyimpa. "The drop in petrol, diesel, and liquefied gas prices is a welcome change after several months of rising costs."

Despite the decrease in fuel prices, the broader economic picture remains challenging.

The data from UBOS also indicated an increase in annual Headline inflation rates.

The Annual Headline Inflation for the 12 months leading up to June 2024 rose to 3.9 percent, up from 3.6 percent recorded for the year ending in May 2024.

Similarly, the Annual Core Inflation increased to 3.8 percent in June 2024, compared to 3.7 percent in May 2024.

"This rise in annual headline inflation is largely attributed to the increase in core inflation, which climbed to 3.8 percent," explained Niyimpa.

"While fuel prices have dropped, the overall cost of living continues to rise, impacting households and businesses across the country."

The mixed signals from the recent data present a complex scenario for Uganda's economy.

On one hand, the decrease in fuel prices could alleviate some of the financial pressures on consumers and businesses, potentially stimulating economic activity.

Lower fuel prices often lead to reduced transportation and production costs, which can translate to lower prices for goods and services.

However, the rising inflation rates suggest that the cost of living is still on the rise, which could offset the benefits of lower fuel prices.

Higher inflation erodes purchasing power, making it more expensive for consumers to buy goods and services. This, in turn, can dampen consumer spending and slow down economic growth.

"While the decrease in fuel prices is positive, we must remain vigilant about the rising inflation," Niyimpa cautioned.

"It's essential to adopt measures that address inflationary pressures to ensure economic stability and growth."

The recent data from UBOS underscores the need for a balanced approach to economic policy.

Policymakers will need to carefully monitor inflation trends and implement measures to manage price stability while supporting economic growth.

This could include monetary policies aimed at controlling inflation and fiscal policies designed to stimulate economic activity.

Moreover, the government might consider targeted interventions to support vulnerable households and businesses affected by rising costs.

By addressing both the immediate and long-term challenges, Uganda can navigate through the current economic fluctuations and pave the way for sustainable growth.

The decrease in fuel prices in June 2024 offers a glimmer of hope for Ugandans.

However, the rising inflation rates highlight the ongoing economic challenges that need to be addressed.

As Niyimpa aptly put it: "It's a complex economic landscape, and our focus should be on ensuring stability and growth for all Ugandans."