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Uganda Shilling Strengthens Supported By Strong Diaspora Remittances

The Uganda Shilling strengthened against the dollar on the back of strong inflows mainly from Diaspora and nongovernmental organizations during the week ending 22nd December 2017.
Demand remained muted in a market slowdown ahead of the holidays. Trading was in the range of 3600/3610.
In the money market overnight funds traded at 7:50% while one week traded   at 9:50%, holding at same levels of the previous week.
In the fixed income, the Treasury Bill auction was heavily oversubscribed and yield continued to edge down across all the maturities to trade at 8.077%, 8.234% and 8.949%.
In the regional markets, the Kenya Shilling held firm trading 103.14, but was likely to come under pressure due to increased demand mainly from oil importers.

The South African rand rose on a strong positive sentiment following the election of the Cyril Ramaphosa as the new head of African National Congress.

In the international currency markets, the US dollar remained bullish after the most prominent US tax overhaul in 30 years was passed and also supported by a rise in US bond yields.

“Outlook indicate a strong [Uganda] Shilling supported by healthy inflows mainly from the Diaspora, in the last trading week of the year amidst soft demand, as most corporate players shut down,” observes, Stephen Kaboyo, an analyst and Managing Director at Alpha Capital Partners.

Taddewo William Senyonyi
William is a seasoned business and finance journalist. He is also an agripreneur and a coffee enthusiast.

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