The Central Bank is set to make a monetary policy announcement on Monday for the next two months
The shilling traded sideways and remained in a relatively narrow range as demand was on and off. The Central Bank was in the market mopping up excess liquidity.
In the treasury bill market, Bank of Uganda offered sh170 billion in last week's auction. Yields remained flat coming out at 15.683%, 16.28%, and 17.478% for the 91,182,364 days bills respectively.
In the International currency markets, the dollar recovered from the previous week's lows as markets awaited the US non-farm payroll data seen as a key determinant on the timing of the next interest rate hike.
In the UK, Bank of England cut interest rates from 0.5% to a record of 0.25% since 2009. The Bank signalled that rates could go lower if the economy worsens.
"Outlook for the shilling indicate mild weakening on account of position covering ahead of the Central Bank policy meeting that is likely to reduce the policy rate as inflation continue to trend downwards," Stephen Kaboyo of Alpha Capital Partners said in a statement.
The Central Bank is set to make a monetary policy announcement on Monday for the next two months.