Uganda shilling holds ground against the dollar

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By Stephen Kaboyo

The Uganda shilling held its ground, staying flat against dollar on sluggish demand against descent inflows mainly from the commodities sector and charities.

Trading was in the range of 3,685/3,695.
In the money market, overnight funds quoted at 6% while one week funds held at an average of 9%.

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In fixed income space, Treasury bill auction saw yields edge up across all tenors to print 9.048%, 10.947% and 12.000%.
Subscription was short on the 91 and 364 days.

In a related development, Government announced its intended commercial borrowing of 660 million USD to fill the budget financing gap arising out of the revenue shortfalls.

In the regional currency markets, the Kenya shilling strengthened supported by significant flows mainly from remittances.
Tight liquidity conditions also played in support. Trading was in the range of 101.75/95.

On the global scene, the US dollar was held down by nervousness on trade negotiations and on hints of weakness in the US economy.
Dismal data on private sector payrolls, soft service activity and a shrinking manufacturing sector did not augur well for the greenback.

Outlook for the shilling indicate a stable unit largely supported by the December effect where sentiment speaks to an interval of a strong stance backed up by seasonal remittances.

Alpha Capital Forex Bureau: For competitive Forex Rates VISIT Plot 12 KAMPALA ROAD-CHAM TOWERS SUITE 43: call: 0414-580619, 0392-612648

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