By Stephen Kaboyo
The Uganda Shilling (Ugx) strengthened during the week and touched a three week high on account of improved foreign exchange inflows mainly from portfolio investors and unwinding of long dollar positions by commercial banks.
Trading was in the range of Ugx. 3585 and 3600.
In the government securities market, yields came off across all tenors.
The benchmark 91 day treasury bill dropped to 13.298% while the 182 and 364 day treasury bills followed the same trend to trade at 14.218% and 14.796% respectively.
In international currency markets, the US dollar slumped to a 7 week low against the major currencies following President elect Trump’s comments that the greenback was too strong.
This spurred a selling spree in the financial markets putting the dollar on the back foot. However the dollar was later boosted by Federal Reserve Chairperson, Janet Yellen’s hints of multiple interest rate hikes in the coming months.
In the coming days the shilling is expected to remain range bound due to relatively subdued market activity, in a short trading week.
The writer works with Alpha Capital Partners