Uganda Shilling weakens further; as Kenyan, Tanzanian currency gain

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By Stephen Kaboyo

The Uganda shilling was on the back foot undermined by an uptick in demand from the energy and manufacturing sectors coupled by commercial banks squaring their positions.

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At close of the week trading was in the range of 3718/3728 compared to opening levels of 3695/3705.
In the money market, overnight funds traded at 6% while one week quoted at 9%.

In the fixed income market, yields in the treasury bills continued on the marginal downward trajectory at 8.144%, 10.067% and 10.998% for 91,182 and 364 days respectively.

Significant demand was registered across all tenors.

In the regional currencies, the Kenya shilling was seen gaining ground supported by offshore inflows targeting the infrastructure bond with the market quoting the unit at 103.15/35, while the Tanzania shilling was fairly stable due end month flows that satisfied market demand.
Trading was in the range of 2298/2308.

In the global markets the dollar benefitted from the sterling weakness but broadly the Bull Run was driven by higher than expected manufacturing PMI data that came in better than the previous numbers.

In Britain, the pound nursed huge losses after the call for elections heightened the uncertainty of Brexit.

The shilling forecast indicate continued weakness as a rebound of customer demand from major sectors is expected to exert pressure , driving the unit lower, even with end month flows factored in.

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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