Uganda shilling flat against dollar
Jul 26, 2011
The Uganda shilling traded flat against the dollar for a second straight session on Tuesday and was expected to remain in a narrow range due to subdued dollar demand.
The Uganda shilling traded flat against the dollar for a second straight session on Tuesday and was expected to remain in a narrow range due to subdued dollar demand.
At 0820 GMT commercial banks in Kampala exchanged the local currency at Monday's closing rate of 2,600/2610 per dollar.
The market had anticipated end-of-month dollar demand by corporates in the manufacturing and energy sectors but traders said those expectations were yet to materialise.
"We're stuck in a stable and quiet market and primarily because corporate demand in key sectors remains subdued," said Charles Katongole, a trader at Standard Chartered Bank Uganda.
"Corporates in energy and manufacturing might still come in with demand in the last few days of the month which could weaken the shilling, but otherwise the market will remain stable."
Traditional end-of-month dollar inflows from non governmental organisations (NGOs), too, were weak this month, traders said.
Some market players may be betting on the dollar weakening, said Faisal Bukenya, head of market making at Barclays Bank Uganda.
"Even the oil sector has surprisingly stayed out... I think they're calculating the dollar will shed more value so they can come in at a lower level," he said.
Reuters
At 0820 GMT commercial banks in Kampala exchanged the local currency at Monday's closing rate of 2,600/2610 per dollar.
The market had anticipated end-of-month dollar demand by corporates in the manufacturing and energy sectors but traders said those expectations were yet to materialise.
"We're stuck in a stable and quiet market and primarily because corporate demand in key sectors remains subdued," said Charles Katongole, a trader at Standard Chartered Bank Uganda.
"Corporates in energy and manufacturing might still come in with demand in the last few days of the month which could weaken the shilling, but otherwise the market will remain stable."
Traditional end-of-month dollar inflows from non governmental organisations (NGOs), too, were weak this month, traders said.
Some market players may be betting on the dollar weakening, said Faisal Bukenya, head of market making at Barclays Bank Uganda.
"Even the oil sector has surprisingly stayed out... I think they're calculating the dollar will shed more value so they can come in at a lower level," he said.
Reuters