The Uganda shilling continued to soften against the dollar on the back of a rebound in demand mainly from the importers.
In the early part of the week the scope for shilling stability was opened up by market perception that the Central Bank was to remain aggressive in it’s mop of excess liquidity. Trading was in the range of 3625/3635.
In the bond market, the 03 and 10 year bond auctions were undersubscribed . Bank of Uganda mopped Ugx.92.8billion against the offer of 160 billion. Yields edged up.
In the international currency markets, the US dollar continued to rally as oils prices surged following the long awaited OPEC decision to cut prices while British pound remained firm.
‘ ‘In the coming weeks, the shilling is likely to remain volatile undermined by cyclical demand for dollars as market participants set focus on the upcoming BOU monetary policy meeting.’’ Says Stephen Kaboyo, the Alpha Capital Markets boss