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Mid-month tax payments boost shilling

By Samuel Sanya

Added 15th July 2017 09:46 AM

In the fixed income market, BOU issued a two year and five year bonds in amounts of sh80b and sh100b respectively.

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The Uganda shilling was stable this week supported by tight liquidity conditions in the money market partly due to corporate players gearing for mid-month tax payments, Stephen Kaboyo, the Alpha Capital’s CEO says. Trading was in the range 3602/3612.

In the fixed income market, BOU issued a two year and five year bonds in amounts of sh80b and sh100b respectively.  The coupon for the two year was 13.750% and five year was 14.125%, while the weighted yields were 12.789% and 14.154%.

In international currency markets, the US dollar was flat ahead of the release of inflation data. Markets were cautious, contemplating that signs of a pickup in inflation could reinforce views that the Federal Reserve Bank could hike interest rates sooner than later.

In commodities market, oil prices dipped on the back of high inventories. Brent crude strafed at $48.35 per barrel.

Kaboyo points out that the shilling is likely to remain stable, trading within a narrow band as tight liquidity conditions prevail.

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