Shilling loses ground
May 01, 2006
The shilling lost ground against hard currencies in the week to Friday, weighed down by inter-bank dollar demand, traders said, writes <b>Paul Busharizi.</b>
The shilling lost ground against hard currencies in the week to Friday, weighed down by inter-bank dollar demand, traders said, writes Paul Busharizi.
The shilling closed the week at 1,830/40 to the dollar, down from the previous week’s 1,825/30.
“The inter-bank market was short on dollars and a rush to buy dollars to cover the position pushed the shilling down,†dfcu Bank’s chief dealer David Bagambe said.
The market’s short position, a situation where dealers have sold more currency than they actually have, came in the wake of heightened dollar demand from corporates looking to fulfill dividend payments.
Significant inflows from exports and a double Bank of Uganda intervention helped smoothen shilling losses, which traders believe will continue into this week.
Ends
The shilling closed the week at 1,830/40 to the dollar, down from the previous week’s 1,825/30.
“The inter-bank market was short on dollars and a rush to buy dollars to cover the position pushed the shilling down,†dfcu Bank’s chief dealer David Bagambe said.
The market’s short position, a situation where dealers have sold more currency than they actually have, came in the wake of heightened dollar demand from corporates looking to fulfill dividend payments.
Significant inflows from exports and a double Bank of Uganda intervention helped smoothen shilling losses, which traders believe will continue into this week.
Ends