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Uganda Shilling Maintains Firm Stance against US Dollar

The Uganda shilling maintained a firm stance, with a bit of volatility mid-week due to a slight pickup in demand but thereafter, improved inflows helped to cushion the unit during the week ending 24th February 2017.

Trading remained in the range of 3580/90, similar to the previous week.

According to market updates from Alpha Capital Partners, in the Treasury bond market, BOU reopened a 3 and 5 year bonds worth 160 billion.

Coupons on both were 17.000% and 16.625% while the weighted yields were 15.252% and 16.260% respectively. Both tenors were oversubscribed.

In international currency markets the dollar recovered from previous week losses as the Federal Reserve minutes indicated that interest rate hike may sooner than later.

Sterling strengthened to a two week high against the dollar as the political developments both in the US and EU overshadowed the Brexit concerns.

“In the coming week, the [Uganda] Shilling is likely to remain range bound, as end month flows provide support in a subdued market,” Stephen Kaboyo, a market analyst and Managing Director at Alpha Capital Partners said.

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