The Uganda shilling weakened during the week as pressure from interbank and corporate activity gained momentum. Market players were seen building positions ahead of end month.
Bank of Uganda was active in open market operations, mopping up excess liquidity. Trading was in the range of 3380/3390.
There was no primary auction in the government securities. Bank of Uganda will offer Ugx. 165 billion ($48.8Mn) in the Treasury bill auction scheduled for 28th September 2016.
In the international markets the US Federal Reserve Bank kept it’s Feds fund rate unchanged, expressing confidence in the economy but not enough to make a move but teed up a likely lift at it’s December meeting.
Following the pronouncement, the US dollar fell against other major currencies, giving a boost to commodities priced in the US currency. The British Pound and the Euro pulled up 0.63% and 0.51% against the dollar respectively.
Outlook for the shilling indicate slight weakening amid expectation of a likely end month uptick in demand.