Business
Shilling dips as banks, energy firms seek dollars
Publish Date: Apr 04, 2014
Shilling dips as banks, energy firms seek dollars
  • mail
  • img
newvision

KAMPALA - The Ugandan shilling weakened modestly on Friday on the back of rising demand for the dollar from commercial banks and energy businesses, but an expected squeeze on liquidity was seen supporting the currency
next week.


Commercial banks quoted the currency at 2,558/2,568, weaker than Thursday's close of 2,555/2,565.

"There's a lot of appetite for the dollar in the interbank (market) which has weakened the shilling," said Ahmed Kalule, trader at Bank of Africa.

"We anticipate some tightening in liquidity early next week so we're likely to see the shilling pull back from losses we have seen today," he said.

The central bank on Friday mopped up 227 billion Ugandan shillings ($89 million) from the market via a seven-day repo.

The shilling is down 1.6 percent against the dollar so far this year but analysts said the central bank's decision to hold interest rates steady at 11.5 percent at its April meeting could provide support despite the halting of some aid.

Western donors have suspended or diverted aid and loans worth about $118 million after the enactment of an anti-gay law.

"I have seen substantial buying (of dollars) from energy and manufacturing sectors," said Brenda Akumu, trader at KCB Uganda, adding that energy firms were stocking up.

Reuters

The statements, comments, or opinions expressed through the use of New Vision Online are those of their respective authors, who are solely responsible for them, and do not necessarily represent the views held by the staff and management of New Vision Online.

New Vision Online reserves the right to moderate, publish or delete a post without warning or consultation with the author.Find out why we moderate comments. For any questions please contact digital@newvision.co.ug

  • mail
  • img
blog comments powered by Disqus
Also In This Section
Look out for opportunities, Museveni tells youth
President Museveni calls Ugandan youth to have initiative and also take advantage of the available opportunities in the various sectors of the economy....
Mbale Municipality closes over 50 sub-standard schools
Mbale Municipality on Thursday closed over 50 schools for operating below the minimum required standards...
President should address UNATU, ministry feud over SACCO money
The National Organization of Trade Unions (NOTU) has called for the president’s intervention in the ongoing standoff between the Uganda National Teachers’ Union (UNATU) and the ministry of education over shs25b meant for teachers’ SACCOs...
Security to be improved at Entebbe International Airport
By Billy Rwothungeyo Why do you have to hop out of your car to have a hand metal detector pressed against your body just before entering Entebbe International Airport? Why should you not drive through hustle free straight to the departures gate at Entebbe?...
National Water, Entebbe Municipality scoop procurement award
National Water and Sewerage Corporation (NWSC) and Entebbe Municipal Council have been recognized as the most efficient Public Procuring and Disposing Entities (PDEs) of the 2013/2014 financial year....
Yiiya Ssente forum: Past participants to share testimonies
The Yiiya Ssente business forum is on today at Kololo Airstrip....
Do you think government is doing enough to contain the typhoid out break?
Yes
No
Can't Say
follow us
subscribe to our news letter