KAMPALA, Uganda–The Uganda shilling closed the 2017/18 financial year at the the 3870/3890 levels against the U.S dollar as calm activity on both demand and supply counters throughout the day limited any movements in the pair.
Uganda’s year on year inflation for June rose to 2.2 per cent compared from 1.7 per cent in May 2018. The rise is on account of the increase in the annual energy, fuels and utilities (EFU) inflation that rose to 15.1 percent for the year ending June compared to 10.3 percent recorded in the year
ended May 2018.
This week, we expect a range-bound trading session for the USD/UGX pair alongside a treasury bill auction slated for Wednesday.
The U.S. dollar ended the week lower against other major currencies on Friday amid a buoyant euro and
despite positive U.S. economic data. The U.S. Personal Consumption Expenditures (PCE) price index, excluding food and energy, rose 2% in the 12 months through May, beating expectations, while the
Chicago business barometer rose to a reading of 64.1 in June from 62.7 the prior month, topping economists’ estimates of 60.0.
The Euro soared against the dollar after the E.U. member states struck a migration deal, agreeing on,
among other measures, stepping up border security and setting up holding centers to handle asylum seekers, thus easing political uncertainty within the bloc.
The Cable likewise rallied to a peak of 1.3194 after U.K.’s Gross Domestic Product (GDP) grew faster-than expected in Q1, to 0.2% versus a forecast of 0.1%, renewing investor expectations for a Bank of England rate hike this year.