The Uganda shilling weakened on the back of significant demand for dollars from commercial banks squaring their positions, and elevated import demand during the week ending 9th March 2018.
Trading was in the range 3652/3662, ten shillings above last week’s closing range.
In the interbank money market, overnight funds traded at 6.00% while one week traded at 8.50%.
There was no primary auction for government securities. Trading was restricted to the secondary market.
In regional markets, the Kenya shilling was unchanged against the dollar, supported by conversions from horticulture amid low demand conditions. Trading was in the range of 101.20/40.
In international markets the US dollar was bullish riding on hopes of possible breakthrough in the North Korea standoff. Also fanning broad- based appetite was the signing of the steel tariff that turned out to exempt Canada and Mexico while keeping the door open for other countries to seek exemptions.
“Outlook for the shilling indicates range bound trading heightened by demand pressures,” Stephen Kaboyo, an analyst and Managing Director at Alpha Capital Partners says.