Uganda’s economy registered a robust performance in early 2026, with new data pointing to strong growth, easing inflation, and a significant boost in export earnings.
According to preliminary estimates from the Uganda Bureau of Statistics, the economy expanded by 8.5 percent in the second quarter of the 2025/26 financial year, up from 5.4 percent recorded in the same period last year. The growth was largely driven by increased demand and sustained investments in ICT equipment, construction, machinery, and other key sectors.
The Ministry of Finance report shows that economic activity in February 2026 continued on an upward trajectory, supported by improved business conditions, higher output, and increased employment.
Key indicators such as the Purchasing Managers’ Index (PMI) and the Business Tendency Index (BTI) remained above the 50-point mark, signaling positive business sentiment and a favorable economic outlook.
Inflation also showed signs of stabilizing, with annual headline inflation easing to 2.9 percent in February, down from 3.2 percent in January. The decline was mainly attributed to slower increases in the cost of services, particularly international air transport and healthcare expenses such as consultation and hospitalization fees.
The Bank of Uganda maintained the Central Bank Rate at 9.75 percent for the seventeenth consecutive month, noting that the rate remains appropriate to support economic growth while keeping inflation within the medium-term target of 5 percent.
Uganda’s external sector also recorded a remarkable turnaround. In January 2026, the country posted a merchandise trade surplus of USD 147.26 million, reversing previous deficits both on a monthly and annual basis.
Export earnings surged by 72.1 percent year-on-year, rising from USD 844.60 million in January 2025 to USD 1.45 billion in January 2026. This growth was driven by strong performance in key exports including gold, coffee, industrial products, oil re-exports, beans, and electricity.
The latest figures highlight growing resilience in Uganda’s economy, with sustained investments, improving business confidence, and rising export revenues positioning the country for continued expansion.
