Shilling stable due to low dollar demand

The Uganda Shilling was unchanged against the dollar on Friday.

"The Shilling was largely stable in a fairly even market with a bias towards a mild appreciation on account of players unwinding long dollar positions as demand remained subdued at the end of the week," stated Stephen Kaboyo a financial expert.

The local unit was trading in the range of 3,595/3,605 buying and selling respectively against the dollar.

In the money market, overnight funds traded at 8% while 1 week funds traded at 11%.

In fixed income market, BOU offered 180 billion in treasury bills.  Yields marginally dropped to 9.574%, 10.149%, 11.305% for 91,182 and 364 respectively.

In the international currency markets the dollar stumbled against major currencies as Trump's efforts to overhaul Obamacare failed in the US Senate. 

Markets went into a cautious mode with concerns that even Trump's economic plans of tax reforms and economic stimulus may not go too far.

In commodities markets, oil prices were little changed ahead of key meeting of oil producing countries. A barrel traded just below U$50.

"In the coming days the shilling is expected to remain stable as players continue to convert to local currency against low demand," Kaboyo said, adding that some cushion will also be derived from increased end month forex flows.

However, regionally, the unit traded at 34.6/ 34.7buying and selling respectively to the Kenyan Shilling; and 1.6/ 1.61 buying and selling respectively to the Tanzanian Shilling.