Uganda's central bank on Tuesday maintained its key lending rate at 10.0%, saying it wanted to keep policy tight to consolidate a drop in inflation.

The decision, announced by Deputy Governor Michael Atingi-Ego at a news conference, was the fourth consecutive time the bank has kept its policy rate unchanged.

Inflation fell to 6.2% year-on-year in May from 8.0% a month earlier.

"The current monetary policy stance remains appropriate to consolidate the gains made and restore price stability while supporting economic growth," Atingi-Ego said.

The deputy governor said a stable exchange rate and lower food prices had helped inflation fall and that the bank expected that inflation would continue to decline.

Uganda's economic growth is forecast to be in a range of 6%-6.5% in the 2023-24 fiscal year, up from an estimated 5.5%-6.0% in 2022-23, Atingi-Ego said.

The finance ministry forecasts the economy will grow 6% in 2023-24 from 5.5% in 2022-23, lifted by investments in the petroleum industry ahead of planned commercial crude on production in 2025.

Reflecting on the medium-term outlook, Atingi-Ego said transportation, manufacturing and construction were also seen driving growth.

(Reporting by Elias Biryabarema, Writing by George Obulutsa, Editing by Alexander Winning and Ed Osmond)