{"id":15828,"date":"2021-08-16T14:33:44","date_gmt":"2021-08-16T14:33:44","guid":{"rendered":"https:\/\/www.africa-press.net\/uganda\/?p=15828"},"modified":"2021-08-16T14:31:01","modified_gmt":"2021-08-16T14:31:01","slug":"interest-rates-drop-amid-subdued-credit-demand","status":"publish","type":"post","link":"https:\/\/www.africa-press.net\/uganda\/all-news\/interest-rates-drop-amid-subdued-credit-demand","title":{"rendered":"Interest rates drop amid subdued credit demand"},"content":{"rendered":"<p><span style=\"color: #ff6600\"><strong><a href=\"https:\/\/www.africa-press.net\/\">Africa-Press<\/a> &#8211; <a href=\"https:\/\/www.africa-press.net\/uganda\">Uganda<\/a>. <\/strong><\/span>Demand for credit remained subdued in the period ended June even as interest rates, for the first time in many years, dropped to below 19 per cent.<\/p>\n<p>According to data from Bank of Uganda, highlights in the Monetary Policy report, indicate that during June, lending rates dropped by almost two percentage points from 19.6 per cent in May to 18.2 per cent.<\/p>\n<p>The reduction, Bank of Uganda said, was driven by availability of cheap credit due to reduction in the Bank of Uganda Central Bank Rate, which resulted into subdued lending rates for prime borrowers, especially in the telecom and oil sectors.<\/p>\n<p>Lending rates have been on a downward trajectory since February following persistent easing of the Central Bank Rate.<\/p>\n<p>During June lending rates for shilling-denominated loans declined to 18.2 per cent. However, lending rates for foreign currency-denominated loans increased, averaging at 6.4 per cent from 5.3 per cent in May.<\/p>\n<p>The reduction thus supported growth in private sector credit, which grew by 6.8 per cent in the quarter to June but was much lower than the 9.8 per cent growth that had been registered in the quarter ended March.<\/p>\n<p>Loan approvals stood at Shs2.25 trillion during the quarter to June 2021 from Shs2.17 trillion in the quarter to March.<\/p>\n<p>Applications fell to Shs3.78 trillion from Shs5.01 trillion in the quarter to March, reflecting low demand due to a slowdown in economic recovery.<\/p>\n<p>However, Bank of Uganda said private sector credit will grow at moderate rates in the medium to long-term as Covid-19 containment measures take pace to support economic recovery.<\/p>\n<p>The Central Bank has been active in supporting economic recovery through using open market instruments to align interbank markets with the monetary policy targets.<\/p>\n<p>For instance, during the period seven-day interbank rates dropped to 7.1 per cent, down from 7.4 per cent.<\/p>\n<p>Yield on government securities, Bank of Uganda said, for both Treasury Bills and Bonds for all tenors declined.<\/p>\n<p>Exchange rates remained relatively stable, depreciating by just 0.3 per cent month-on-month in July 2021 compared to an appreciation of 0.3 per cent in June 2021.<\/p>\n<p>Year-on-year, exchange rates appreciated by 4.1 per cent compared to 5.3 per cent year-on-year in June.<\/p>\n<p><b>[email protected]<\/b><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Africa-Press &#8211; Uganda. Demand for credit remained subdued in the period ended June even as interest rates, for the first time in many years, dropped to below 19 per cent. According to data from Bank of Uganda, highlights in the Monetary Policy report, indicate that during June, lending rates dropped by almost two percentage points [&hellip;]<\/p>\n","protected":false},"author":84,"featured_media":15827,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2,5,8],"tags":[233,240,234],"class_list":["post-15828","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-all-news","category-economy","category-homepage-english","tag-africa-press","tag-africa-press-uganda","tag-uganda"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.1 (Yoast SEO v27.0) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Interest rates drop amid subdued credit demand - Uganda<\/title>\n<meta name=\"description\" content=\"Demand for credit remained subdued in the period ended June even as interest rates, for the first time in many years, dr ...\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.africa-press.net\/uganda\/all-news\/interest-rates-drop-amid-subdued-credit-demand\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Interest rates drop amid subdued credit demand\" \/>\n<meta property=\"og:description\" content=\"Demand for credit remained subdued in the period ended June even as interest rates, for the first time in many years, dr ...\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.africa-press.net\/uganda\/all-news\/interest-rates-drop-amid-subdued-credit-demand\" \/>\n<meta property=\"og:site_name\" content=\"Uganda\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/AfricaPressTunisiaa\" \/>\n<meta property=\"article:published_time\" content=\"2021-08-16T14:33:44+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/static.africa-press.net\/uganda\/sites\/34\/2021\/08\/img-611a768716769.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1160\" \/>\n\t<meta property=\"og:image:height\" content=\"652\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"cfeditoren\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"cfeditoren\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"2 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.africa-press.net\/uganda\/all-news\/interest-rates-drop-amid-subdued-credit-demand#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.africa-press.net\/uganda\/all-news\/interest-rates-drop-amid-subdued-credit-demand\"},\"author\":{\"name\":\"cfeditoren\",\"@id\":\"https:\/\/www.africa-press.net\/uganda\/#\/schema\/person\/068c7ab4e9634ae78ec5d54ec46598bb\"},\"headline\":\"Interest rates drop amid subdued credit demand\",\"datePublished\":\"2021-08-16T14:33:44+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.africa-press.net\/uganda\/all-news\/interest-rates-drop-amid-subdued-credit-demand\"},\"wordCount\":358,\"commentCount\":0,\"image\":{\"@id\":\"https:\/\/www.africa-press.net\/uganda\/all-news\/interest-rates-drop-amid-subdued-credit-demand#primaryimage\"},\"thumbnailUrl\":\"https:\/\/static.africa-press.net\/uganda\/sites\/34\/2021\/08\/img-611a768716769.jpg\",\"keywords\":[\"Africa Press\",\"Africa Press-Uganda\",\"uganda\"],\"articleSection\":[\"all news\",\"economy\",\"homepage-english\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/www.africa-press.net\/uganda\/all-news\/interest-rates-drop-amid-subdued-credit-demand#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.africa-press.net\/uganda\/all-news\/interest-rates-drop-amid-subdued-credit-demand\",\"url\":\"https:\/\/www.africa-press.net\/uganda\/all-news\/interest-rates-drop-amid-subdued-credit-demand\",\"name\":\"Interest rates drop amid subdued credit demand - 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