BOU Governor Emmanuel Tumusiime-Mutebile said on Monday that many consumers are expected to be hesitant to resume their previous spending patterns, partly due to fears of contracting the virus and uncertainty about earnings. He added that even those whose incomes were not affected may increase their need for precautionary savings.
Mutebile, who appears to make a U-turn from earlier position that banks can charge borrowers based on their own assessments, says he was disappointed that banks had refused to reduce charges on loans to spur growth.
BOU says it has granted exceptional permission to banks to restructure loans of corporate and individual customers including a moratorium on loan repayment for borrowers that have been affected by the pandemic, on a case by case basis for up to 12 months, effective April 1, 2020. BOU adds this is still at the discretion of the banks.
Mutebile told a meeting in Kampala on Friday that the opportunity to borrow non-concessional – expensive money – to meet infrastructure needs has become very tempting, especially in anticipation of oil revenues, which serve as collateral for borrowing from international markets.
According to BoU Governor Emmanuel Tumusiime-Mutebile, core inflation, which measures the increases in prices of goods and services less electricity, food and water, will peak 6.4% between October and December 2020.
The East African Monetary Union Protocol, signed in 2013, set 2024 as the year to have all countries in the EAC using a single currency, and integrated payment systems. However, preparations, including setting up regional statistics body, the East African Financial Services Commission, and the East African Monetary Institute, have progressed rather slowly.
Mutebile, who was reading the monetary policy statement to journalists at BOU offices in Kampala on Tuesday afternoon, said the only investigation he knows is that of extra pallets on the plane not the one of printing extra currency which he says is not true.
Mutebile told COSASE chaired by Bugweri County MP Abdu Katuntu, that it was necessary to close the banks because failure to intervene would have led to a financial crisis that would have harmed the financial sector, businesses and economy.
COSASE Chairperson Abdu Katuntu cited a letter signed by Governor Mutebile making rounds on social media indicating that confidential documents have been sent to him.
The decision was made today by parliaments committee on Commissions, Statutory Authorities and State Enterprises-COSASE. It follows queries that the Central Bank flouted procurement laws when it spent 125 million Shillings to purchase 350 pens in financial year 2016/2017.
But during cross examination by Gerald Karuhanga, the PAC vice chairperson, NMS officials insisted that they have never received any funds despite receiving confirmation from the Finance Ministry that the money was ready.
The question was in relation to reports in todays copy of The Red Pepper claiming that the Governor was seriously ill and living off a life-saving machine. Governor Mutebile, in his usual candidness, retorted that as all and sundry could see he was well. He faulted the The Red Pepper for trading in falsehoods.
BoU Governor Tumusiime-Mutebile says domestic demand is picking up with the economy projected to grow more strongly in financial year 2016/17 at about 5.5 percent compared to the preliminary estimate of 4.6 percent the previous year.
Rt. Colonel Dr. Kizza Besigye, the former President for the Forum for Democratic Change -FDC Party wants the Governor Bank of Uganda, Emmanuel Tumusiime-Mutebile prosecuted and jailed for alleged abuse of office.
Prof Emmanuel Tumusiime-Mutebile, the Governor BOU says the reduction was warranted in order to boost an economy growing below its potential. He was issuing the Monetary Policy Statement for June 2014 today.
Parliament on Tuesday rejected recommendations of the public accounts committee that sought to have the central bank governor, Tumusiime Mutebile, sacked for his role in the compensation of 142 billion shillings to city businessman, Hassan Basajjabalaba.
