The Uganda shilling was on the back foot undermined by a surge in demand for forex from market players covering their short positions. Trading was in the range of 3635/3645.
In the fixed income market, Bank of Uganda offered 165 billion. Yields continued on the down trajectory, dropping to 10.082%, 11.538% and13.837% for 91, 182, and 364 day respectively.
In international currency markets, the US dollar remained flat after US President tax plan offered no surprises as markets kept a watchful eye. The British pound recouped it’s losses as investors took a view that political risk had faded.
In commodities markets, Gold prices edged down on scepticism over President Trump tax plan, while oil prices held at $49.37 as OPEC led production cut seemed to have failed to tighten oversupply.
Going forward, the shilling is likely to maintain a bearish tone as the falling interest rates make it cheaper for commercial banks to hold long dollar positions.
The writer works with Alpha Capital Forex Bureau: For competitive Forex Rates call: 0414-580619, 0757 450832, 0392-612648