By Stephen Kaboyo
In the first trading week of 2023, the shilling opened weak on renewed demand as businesses resumed operations after the festive season. The unit lost the appreciation momentum and traded above the key level of 3700.
In Kenya, the shilling opened stable with demand and supply evenly matched and the unit was quoted at 123.35/55. The KES lost about 8% against the dollar in 2022.
In the first treasury bill auction of the new year, Bank of Uganda mopped 287 billion against 215 billion on offer. Yields marginally dropped as BOU continued on their strategy of directing bids to the long end while cutting off outliers on the 3 and 6 months.
In the global markets, the dollar inched up but struggled to make bigger gains as the boost from a still hawkish Fed was tempered by investors growing appetite for riskier assets.
In the coming months, the overall market outlook will generally be directed on how best the domestic economy responds to a challenging macro-economic backdrop of persistent global geopolitical tensions, sticky inflation, volatile energy prices and tight financial conditions.
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