The shilling closed the week a tad stronger from Monday’s opening versus its American counterpart owing to a slight increase in foreign currency inflows.
The home unit traded sluggishly early in the session with most players having lightened their foreign currency positions and remaining on the sidelines ahead of the weekend.
Later in the day however, an uptick in supply of the greenback gave the local currency a boost, to end slightly higher than previous close. In the new week, we expect the USD/UGX pair to continue trading within the top end of the recent range.
Dollar ends roughly flat
The dollar ended roughly flat on Friday, retracing the morning’s move higher, after worries tied to trade tensions and a Federal Reserve rate cut weighed on consumer sentiment.
All eyes will be on the Federal Reserve this week as traders await fresh insights on how the central bank may respond to growing fears of a recession after the U.S. Treasury yield inverted last week.
The pound advanced broadly on Friday, notching up its biggest daily rise versus the euro in nearly five months, as a combination of news and decent data provided enough ammunition to speculators to buy the struggling British currency.
The euro fell to a two-week low of $1.1067 shy of the two-year low of $1.1025 it reached on Aug. 1. Friday morning’s fall was caused by growing expectations of an interest rate cut by the European Central Bank after Governing Council member Olli Rehn suggested on Thursday the central bank could restart its quantitative easing program and was open to extending it into equity purchases.