Uganda’s Central Bank Raises Interest Rate Amid Shilling slide.

Uganda’s central bank raised its key interest rate by 50 basis points at a special meeting convened after the local shilling currency plummeted to an all-time low.

The decision to increase the Central Bank Rate to 10.00% comes after three consecutive meetings where the rate remained unchanged.

The shilling has depreciated by approximately 3% against the dollar this year, reaching a record low of 3,955/3,965 against the U.S. currency on Feb. 26 before experiencing a slight recovery in recent sessions.

“The depreciation of the shilling exchange rate has necessitated the tightening of monetary policy,” stated the central bank’s deputy governor Michael Atingi-Ego.

He attributed the shilling’s decline in part to offshore investors withdrawing funds from Uganda in search of higher yields elsewhere.