Inflation has become a familiar companion to election seasons in many developing democracies, and Uganda is no exception. As countries approach elections, prices of basic goods and services often rise, squeezing household incomes and heightening public anxiety. While inflation is influenced by global shocks such as fuel prices, climate change, and supply chain disruptions, the electoral cycle itself has increasingly emerged as a powerful domestic trigger.
At the heart of election-related inflation is the surge in government spending. In the run-up to elections, governments tend to increase expenditure on infrastructure projects, social programmes, public sector allowances, and politically strategic interventions aimed at winning voter support. While such spending may stimulate short-term economic activity, it also injects large amounts of money into the economy within a short period. When the supply of goods and services fails to keep pace with the sudden increase in money circulation, prices rise.
One of the most visible drivers of election-cycle inflation is campaign spending. Political parties, candidates, and their supporters spend heavily on rallies, transport, accommodation, fuel, food, and media publicity. This spending creates localised demand shocks, especially in urban centres and politically competitive regions. Hotels raise accommodation fees, transport fares increase, and food prices climb as traders take advantage of heightened demand. For ordinary citizens, this translates into higher living costs long before a single vote is cast.
Mwambutsya Ndebesa, a lecturer at Makerere University, explains that inflation is largely driven by the increased circulation of money, not only from aspiring candidates but also from the government, which is the biggest spender. ‘Government is compensating all those it owes money. The Budget deficit has soared because the State wants to demonstrate concern for the welfare of voters,’ he says. The academic says the government cannot mitigate these effects since its priority is power retention and legitimacy after controversial elections. ‘It will spend more, but gold sales will offset inflation. Now that M23 is gaining more territory, more gold is coming in.’
He predicts that inflation will occur, but not at alarming levels. ‘There will be some inflation, but not much, because of gold and coffee revenues. However, the challenge is that no money is reaching the pockets of the masses, and not much is flowing into the coffers of the Uganda Revenue Authority, since most critical mineral exports are not adequately taxed.’
Latest inflation outlook
The Uganda Bureau of Statistics (Ubos) announced that annual headline inflation for the calendar year 2025 increased to 3.6 percent from 3.3 percent recorded in 2024, according to the latest Consumer Price Index (CPI). This rise was mainly driven by annual average core inflation, which stood at 3.8 percent in 2025 compared to 3.6 percent in 2024. Annual food crops and related items inflation for the year ending December 2025 was 4.4 percent compared to four percent in November 2025. In November, Irish potatoes registered 5.9 percent, cabbage 0.6 percent, passion fruits 1.1 percent, onions 8.2 percent, and fresh cassava 3.0 percent; while in December 2025, Irish potatoes dropped to 2.3 percent, cabbage surged to 35.7 percent, passion fruits rose to 11.1 percent, onions fell to 3.7 percent, and fresh cassava increased to 8.9 percent.
Annual core goods inflation for the year ending December 2025 was 2.5 percent compared to 2.4 percent in November. In November, dried fish stood at 5.6 percent, local chicken at 2.0 percent, bread at 2.1 percent, and off layers at 12.2 percent; while in December 2025, dried fish dropped to 2.4 percent, local chicken rose to 3.2 percent, bread fell to 0.7 percent, and off layers declined to 6.0 percent.
Annual energy, fuel, and utilities inflation for the year ending December 2025 was 1.5 percent compared to 0.6 percent in November 2025. In November, firewood was at 1.2 percent, charcoal at 4.8 percent, petrol at 0.4 percent, and water charges at 0.4 percent; while in December 2025, firewood rose to 4.9 percent, charcoal to 5.3 percent, petrol to 1.4 percent, and water charges to 0.7 percent.
The overall Consumer Price Index (CPI) for the 12 months to December 2025 stood at 138.11 with annual inflation at 3.1 percent, compared to 137.46 and 3.1 percent in November, 137.59 and 3.4 percent in October, 137.61 and 4.0 percent in September, 136.97 and 3.8 percent in August, 136.73 and 3.8 percent in July, 136.90 and 3.9 percent in June, 136.77 and 3.8 percent in May, 136.09 and 3.5 percent in April, 135.43 and 3.4 percent in March, 135.19 and 3.7 percent in February, and 134.33 and 3.6 percent in January.
For comparison, December 2024 recorded a CPI of 133.91, with inflation at 3.3 percent, while November 2024 stood at 133.31, with inflation at 2.9 percent.
Touch and go
Dr Enock Nyorekwa Twinoburyo, a lecturer at Makerere University, says in past general elections, inflation did not rise significantly. ‘In 2011, there was a sharp jump in money supply, but almost all East African economies were also experiencing drought at the time, which pushed inflation higher. In 2016, inflation was driven largely by the sharp depreciation of the currency and the resulting increase in commodity prices. That imported inflation, due to exchange rate pressures, was part of the drivers.’
He notes that the major distortion during election cycles is the relaxation in revenue collection and the surge in expenditures. ‘We see excess currency in circulation and increased spending. Inflation is driven by this rise in money supply. It needs to be controlled, but overall, inflation remains manageable,’ he says.
Dr Twinoburyo cautions that if inflation rises, it increases vulnerability to poverty. ‘If inflation is driven by food prices, it can benefit poor households that are harvesting, but otherwise it hurts the poorest. Rampant expenditures during election years, especially through additional money supply, have been a consistent trend,’ he observes.
The inflationary pressures that followed the 2011 polls were the main trigger for the Walk-to-Work protests that left many State actors on tenterhooks. Little wonder, Dr Twinoburyo says the threat posed by inflation cannot be taken lightly. He, therefore, emphasises the need for effective coordination between fiscal policy and monetary policy during election periods. ‘Without such coordination, the risks of inflationary pressures and economic distortions become much higher,’ he concludes.
Mr Jimmy Byarugaba, an economist, says during election seasons, agricultural markets experience distortions as politicians distribute cash, food items, or farm inputs to voters. ‘While these handouts may boost short-term consumption, they can disrupt normal market signals. Farmers may withhold produce in anticipation of higher prices, while middlemen exploit increased liquidity in rural areas. The result is food inflation that disproportionately affects low-income households, who spend a larger share of their income on basic necessities.’
He adds that another inflationary trigger is politically-motivated fiscal indiscipline. ‘Budget ceilings are sometimes exceeded, supplementary budgets become frequent, and off-budget expenditures increase. In some cases, governments delay difficult economic reforms-such as reducing subsidies or increasing taxes-to avoid voter backlash. These postponements may provide temporary political relief but often weaken macroeconomic stability, leading to price volatility during and after elections.’
Dr Paddy Mugambe, the Dean of the School of Business and Management at the Uganda Management Institute (UMI), says of the dread of inflationary pressures after the 2026 poll: ‘This concern is not new. Past election cycles have consistently shown a familiar pattern: the cost of food, transport, and basic services tends to rise, squeezing household budgets at the very moment when people can least afford it.’
‘Rein in spending’
Dr Mugambe says the situation is compounded by the fact that elections often coincide with the festive season at the end of the year-a period when household spending is at its peak. ‘The combination of heightened demand, increased liquidity from political spending during campaigns (including front-loaded development expenditure, especially on infrastructure), and uncertainty among traders anticipating possible instability creates fertile ground for inflationary pressures,’ he says. He, nevertheless, says election-related inflation is not inevitable. ‘What matters most is discipline and credibility. Clear coordination between the Ministry of Finance and the Central Bank can help restrain unplanned spending, while consistent public communication can stabilise expectations. Quiet but timely interventions-such as releasing food and fuel reserves or monitoring markets to prevent hoarding-can ease pressure without disrupting markets.’
He cautions against harmful measures like broad price controls, which often do more harm than good. Instead, targeted support for vulnerable households through existing social protection systems is a more effective approach, allowing markets to function efficiently while cushioning those most at risk.
‘Keeping prices stable during elections is not just an economic task but also a measure of good governance. By choosing credibility, restraint, and transparency in managing the electoral process, Uganda can reduce uncertainty and build confidence among all actors. This ensures that regardless of the election outcome, the country remains on a positive trajectory-protecting both democracy and citizens’ livelihoods, rather than fostering fear among the population,’ Dr Mugambe says.
Mr Timothy Chemonges, the executive director of the Centre for Policy Analysis (CEPA), observes that inflation around elections is rarely accidental. ‘A recent example is Parliament’s approval of a supplementary budget of over Shs9 trillion, part of which was allocated to the Electoral Commission. While funding elections is necessary, such large unplanned spending injects liquidity into the economy and fuels price pressures.’ Mr Chemonges says election-related inflation hits ordinary citizens hardest. Rising food, fuel, and transport costs quickly erode household incomes, especially for low-income families whose wages do not keep pace with prices.
The most effective protection lies in targeted social safety nets-such as temporary food support, school feeding programmes, and well-designed cash transfers-rather than broad spending. For most households, stability in basic necessities matters far more than headline political promises. ‘Countries that have managed inflation better during elections are those that stick to medium-term fiscal frameworks, publish realistic budgets, and insulate economic institutions from political interference. Discipline before elections is not anti-democratic-it is pro-citizen. For governments seeking credibility, demonstrating that economic stability is a priority, rather than a casualty of electoral competition, is essential,’ he says.