Nominal activity saw the home currency lose ground against the U.S. dollar: Nominal activity in yesterday’s session saw the home currency lose ground against the U.S. dollar as the USD/UGX pair shed close to 5 shillings from previous session. Market activity slowly picked up as a number of major corporates remained on the sidelines.
The highly liquid money market added to the local unit’s vulnerability prompting regulator intervention through a 7 day repo, 28 days and 56 days deposit auctions.
The U.S. dollar stayed firm against a basket of currencies on Thursday, with markets gripped by worries over escalating trade tensions between the United States and China.
The hard currency received some support in the previous session from trade tensions that returned to focus this week but remained little changed, as traders await the monthly jobs report due later in the day for more cues.
The British Pound edged down to $1.3012 after the Bank of England raised its policy interest rate from 0.5 percent to 0.75 percent following a unanimous decision of its nine-member policy board. Bank of England Governor Mark Carney said monetary policy needed to “walk not run” while expressing worries about the risks of a cliff-edged Brexit.
The Euro dropped to session lows on the back of a pop in the dollar. Investors’ attention shifts to economic data to be released today including the Eurozone retail sales and PMIs as well as the U.S. non-farm payrolls and wage growth numbers.
Ahead of the weekend, market players expect an uptick of activity on the local FX scene, buoying the local unit to trade range-bound at 3695/3720 levels.