The Uganda shilling was wobbly at the end of the trading week ending January 17th 2019 undermined by elevated demand mainly from interbank as banks covered positions. Trading was in the range of 3685/3695.
In the shilling money
market, overnight funds quoted at 6% while one week held at 9%.
In the fixed income market segment, a Treasury bill auction with 225 billion on
offer was held. Yields remained generally flat, capping at 9.68%,11.41% and
13.953%. An under subscription was registered at the six month curve.
In the regional markets, the Kenya shilling firmed supported by inflows from
commodities, remittances and offshore investors buying stocks amid thin demand.
KES was quoted at 100.95/101.15 at close of the week.
In global markets the US dollar was bullish after multiple data releases
painted a positive economic picture reversing earlier weaknesses following the
preliminary deal between US and China to de- escalate trade wars. Among the
economic reports, US retail sales increased for a third straight month while a
gauge of manufacturing activity rebounded to its highest level in eight months.
“Forecast for the (Uganda) shilling indicate a stable unit, deriving much of
its support from expected flows commodities. The upcoming Chinese New Year
holidays will also likely have an impact on market activity going forward,”
says Stephen Kaboyo, an analyst and Managing Director at Alpha Capital Partners.
