KAMPALA (Reuters) - Uganda's central bank cut its benchmark lending rate to 9.0 percent from 9.5 percent, its governor said on Tuesday, adding loans for small businesses were still highly priced.
Inflation in the East African economy slowed to 3.0 percent last month, mainly due to a drop in food prices.
"The growth of private sector credit remains below historic levels and the cost of credit remains relatively high for micro and small loans," Governor Emmanuel Tumusiime-Mutebile, told a news conference.
He said the economy was expected to expand by 5.5 percent in the 2017/18 fiscal year, before averaging 6.3 percent over the next five years, mainly due to public investments, domestic consumption and robustness in the farm sector.
(Reporting by Elias Biryabarema; writing by Duncan Miriri; Editing by Janet Lawrence)
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