The Uganda Shilling eased against its foreign counterpart on Thursday as petite volumes in the forex market limited any movements in the currency duo.
Markets

Local unit eases against foreign counterpart on petite forex volumes

The Uganda Shilling eased against its foreign counterpart on Thursday as petite volumes in the forex market limited any movements in the currency duo.

The USD/UGX pair steadied at the 3680/3700 levels. Ahead of the weekend, a similar narrative is expected to hold as traders await fresh factors to give the shilling direction amid a slowdown in hard currency demand from merchandise importers.

High levels of liquidity in yesterday’s money market incited regulatory intervention with a mop-up of Ugx 481 billion via 7day repo and deposit auction.

 

Dollar rises against basket of major currencies

The U.S. dollar rose against a basket of major currencies weighed by a falling euro after European Central Bank President Mario Draghi warned that euro area growth was waning.

The U.S-China trade disputes remains on the cards after U.S. Secretary of Commerce Wilbur Ross said that there is a “fair chance” of a trade deal, with both China and the U.S. eager to end their trade war.

The pound rallied across the board on reports that Ireland’s DUP was prepared to back Theresa May’s Brexit Plan B, although with some additional conditions attached on the Irish border backstop, which would also need Brussels’ approval. The deal faces a debate and vote in Parliament on January 29.

The EUR/USD fell to $1.1301 on Draghi dovish remarks after the ECB left its benchmark rate unchanged, that rates could be kept lower for longer should economic frailties in the region continue.