The home unit seesawed between gains and losses in the previous trading session, ending the day unchanged versus its American counterpart.
Market chatter alludes to a range bound session with the shilling holding at current levels, in the absence of momentous market moving news.
Investor focus shifts to the T-bill auction today, with an offer of Ugx 220bn for the 91, 182 and 364 day papers respectively, as traders expect the rates to hold at current levels.
Dollar remains stronger than peers
The U.S. dollar was stronger against other currencies on Tuesday as investors waited for the Federal Reserve to cut rates. The Fed’s two-day monetary policy meeting, with a rate cut of at least 25 basis points expected today.
The euro was flat at 1.1144, unmoved by lower regional German inflation data and weaker euro area economic sentiment gauges. The consumer price index declined across most key regions in Germany in July.
Traders are waiting for the preliminary harmonized German inflation data at 1200 GMT, which according to the economists polled by Reuters could show a fall in inflation to 1.5% in July from 1.6% in June, on a year by year basis.
The pound continued to decline after falling over 1% on Monday, as newly elected Prime Minister Boris Johnson told the Irish Prime Minister Leo Varadkar that he wants to take the U.K. out of the European Union by Oct. 31 regardless of whether or not there is a deal.