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Tough Times As Shilling Surrenders Recent Gains

The Uganda shilling surrendered some of its recent gains, undercut by a rebound in demand by from commercial banks, energy and manufacturing during the week ending 20th July 2018.

Trading was in the range of 3735/3745.
In the interbank money market, overnight funds traded at 6% while one week funds traded at 9%.
In the fixed income market, 170 billion was on offer for the treasury bill auction. Yields edged up to trade at 10.124, 11.686 and 14.501% respectively.

In regional currencies, the Kenya shilling was firm, but was likely to come under pressure due to month end import demand amid excess liquidity in the local market. Trading was in the range of 100.65/85.

In the international currency markets, the greenback edged down against the major currencies after President Trump expressed concern about the currency strength, indicating that the dollar strength puts the US at a disadvantage. At the same time he expressed displeasure about the Federal Reserve monetary tightening, saying he was concerned about the potential impact on US economy competitiveness.

“Outlook for the shilling indicates sideways trading, with no distinct uptrend or downtrend. Trading is likely to remain in a narrow range as end month flows are like to pair up with the market demand,” says Stephen Kaboyo, an analyst and Managing Director at Alpha Capital Partners.

 

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Taddewo William Senyonyi
https://www.facebook.com/senyonyi.taddewo
William is a seasoned business and finance journalist. He is also an agripreneur and a coffee enthusiast.

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