The Uganda shilling surrendered some of its gains in yesterday’s session underpinned by an uptick in greenback demand by interbank players.
The local FX market was quite in the morning with no movements in the currency, late emergency buyers saw the local unit shrink within the 3730/3750 bracket. Ahead of the weekend, outlook remains for a weaker shilling as greenback demand weighs against the diminishing foreign currency.
Dollar trades lower than rivals
The U.S. dollar ticked lower against a currency basket on Thursday as a cautiously optimistic mood in markets dampened safe haven demand. Market sentiment remained fragile amid growing concerns over a slowdown in the global economy and the ongoing trade conflict between the U.S. and China.
The latest bout of the buck weakness comes as investors start to question how many times the Federal Reserve can raise interest rates in 2019 without risking a slowdown in the U.S. economy, which has held up so far as borrowing costs have risen. Elsewhere, the Pound was fractionally higher against the U.S. currency, with GBP/USD last at 1.2788 as traders await clarity on the progress of a Brexit agreement.
The Euro was a touch higher, with EUR/USD gaining 0.16% to trade at $1.1402 amid hopes that the row between Italy’s government and the European Union over Rome’s 2019 budget, which is in breach of euro zone fiscal rules, can be resolved.