Business
Shilling rebounds ahead of sh1.4 trillion bond auction
The local unit’s recovery was powered by subdued demand for the greenback and a steady stream of foreign exchange inflows that eased pressure on the market and allowed the shilling to regain ground throughout the session.
The resulting contraction in shilling liquidity kept funding costs elevated, with overnight and other short-term money market rates averaging around 12.50% during the session, Absa said.
By: Ali Twaha, Journalist @New Vision
KAMPALA - The Uganda shilling found fresh momentum against the dollar on Tuesday, climbing sharply from opening levels of 4500/4510 to an intraday high of 4340/4350 before settling at 4380/4390 by the close of trading.
The local unit’s recovery was powered by subdued demand for the greenback and a steady stream of foreign exchange inflows that eased pressure on the market and allowed the shilling to regain ground throughout the session.
“The shilling was volatile in the first few hours of trading, recovering some losses to trade just below 4400 for the first time in days mainly on account of some offshore selling activity ahead of the 1.4 trillion bond auction,” Stephen Kaboyo, managing director at Alpha Capital, said.
Liquidity conditions in the banking sector remained relatively tight according to Absa marketing report, reflecting the continued impact of the recent central bank policy rate hike.
The resulting contraction in shilling liquidity kept funding costs elevated, with overnight and other short-term money market rates averaging around 12.50% during the session, Absa said.
Bank of Uganda will conduct a Treasury Bond auction tomorrow, where the benchmark 2-year, 5-year, 15-year and 25-year will be re-opened.
The resulting contraction in shilling liquidity kept funding costs elevated, with overnight and other short-term money market rates averaging around 12.50% during the session, Absa said.
Bank of Uganda will conduct a Treasury Bond auction tomorrow, where the benchmark 2-year, 5-year, 15-year and 25-year will be re-opened.