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Markets: The Shilling deprecated against the USD on Thursday

KAMPALA, Uganda–The Uganda shilling depreciated against the U.S dollar on Thursday with the USDUGX duo hitting fresh high 3700/3720 levels from the 3690/3710 levels seen on Wednesday.

Despite liquidity tightening in the local money market space, the Shilling was undercut by a surge in greenback demand from Commercial banks and corporate players alongside sustained inaudible activity on the dollar supply counters.

Ahead of the weekend, a weaker home currency is still on the cards amidst unrelenting foreign currency demand. However, losses might be capped as players hope for regulatory intervention. 

The U.S dollar traded higher against a basket of major currencies on Thursday boosted by mostly upbeat data as it shrugged off fall in bond yields below 3%.

The U.S. Department of Labor reported on Thursday that initial jobless claims dropped by 24,000 to a seasonally adjusted 209,000 for the week ended April 20th, beating economists’ forecast for a drop to 230,000.

A plunge in the Euro added to U.S dollar strength after ECB president Mario Draghi delivered a mixed message on the Eurozone economy, admitting that the pace of the Eurozone recovery had moderated broadly across all countries but reaffirmed his confidence that inflation would eventually hit the bank’s target.

The EUR/USD fell 0.39% to $1.2113 while the Pound Sterling floated above the $1.3920 mark against the U.S dollar.