The Uganda shilling lost ground on resurgence of dollar demand from importers and interbank against weak foreign exchange inflows.
The seasonal inflows from Ugandans living abroad fell short of expectation. Commercial banks were seen covering short positions. Trading was in the range of Ugx. 3580/3590.
In the government securities market, Bank of Uganda issued 03 year and 15 year bonds with total amount of 160 billion, with coupons of 16.375% and 17.000%.
Yields came out as 16.914% and 17.185%. There was an over subscriptions on both counters.
In the international currency markets, the US dollar continued it’s bullish rally against major currencies mainly on expectation of higher US economic growth.
‘‘The outlook for the shilling indicate a weaker shilling as businesses resume operations after the long holidays. Demand is likely to remain strong against scanty inflows. The global dollar strength will also remain a major factor as markets open for 2017.’’ Says Stephen Kaboyo, the Alpha Capital Markets boss.