Uganda’s inflation story for 2025 is not one of runaway prices but of a quiet, uneven calm in the country’s factories and utilities. Despite headline stability, the economy shows signs of slowing momentum, reflecting softening demand and declining producer prices across key sectors.
According to the latest figures from the Uganda Bureau of Statistics (UBOS), annual headline inflation for manufacturing and utilities remained unchanged at 1.2 percent for the 12 months leading to October 2025. On the surface, stability suggests relief for consumers, but deeper analysis reveals a more nuanced picture of weakening economic activity.
Headline inflation captures the price movement of all goods and services, including the most volatile categories such as food and energy. In contrast, producer prices—the amounts factories and utilities receive for their output—have shown notable declines, signaling squeezed profit margins and subdued demand in key sectors.
Manufacturing inflation eased to 1.6 percent in October, down from 1.9 percent in September, with food-related industries registering the sharpest declines. Food manufacturing fell to 4.7 percent from 5.3 percent, sugar production plunged to 10.5 percent from 22.1 percent, and vegetable and animal oils dropped to 3.8 percent from 6.0 percent. These reductions suggest that last year’s global supply chain pressures are easing, but they also point to cooling domestic demand.
The utilities sector has continued to exert downward pressure on overall inflation. Annual inflation for utilities stood at –2.4 percent in October, slightly improved from –4.7 percent in September. Electricity costs remain the main driver, with electric power generation inflation at –5.6 percent, up from –10 percent in September, reflecting ongoing price contraction for producers.
Monthly data paints a similar subdued picture. Producer prices fell by 0.3 percent in October, deepening the 0.2 percent drop in September. Most of the decline originated in manufacturing, while utilities saw a further 0.6 percent decrease due to persistent electricity price dips.
One notable contributor to the monthly decline was fish processing. Prices for processed and preserved fish, a key export commodity, fell 3.3 percent in October, compared to a 0.9 percent drop in September. This could have significant implications for fishing communities along Lake Victoria and export-dependent businesses that serve European and Asian markets.
Overall, Uganda’s current inflation figures suggest an economy that is holding its ground but not advancing rapidly. Stable headline numbers mask subtle weaknesses in production and utility sectors, signaling that businesses and policymakers may need to monitor demand trends closely to maintain growth momentum.
