The Uganda shilling extended the week’s gains against the U.S dollar on Friday amid hard currency inflows from charities and downcast demand from commercial banks.
In what was a relatively active day on the FX counters, the USD/UGX pair found comfort at the 3660/3680 levels from Monday’s close of 3665/3685.
Today, a similar narrative is likely to ensue alongside sustained muted activity on the greenback demand counters. With no primary auction this week, Government securities trading is confined to the secondary market space.
Dollar posts little change at close of week
The U.S. dollar was little changed on Friday, despite an initial move higher, after the U.S. non-farm payrolls report for January showed sluggish wage inflation, underlining the case for the Fed’s patient stance on further rate increases.
The report showed the U.S. economy created 304,000 new jobs, the highest in 11 months, beating forecasts for 165,000 jobs. The unemployment rate, however, rose to a seven-month peak of 4% and average hourly earnings rose just 0.1%, compared with expectations for a 0.3% increase.
Meanwhile, the GBPUSD pair failed to hold on top of 1.3100 levels pulling back to the 1.3070 area as Brexit uncertainty continues to be the key driver. Of interest this week will be the Bank of England meeting on Thursday.
The EURUSD pair kept the daily range intact around the 1.1460 levels. The Manufacturing PMI for the Eurozone came in at 50.5 in January’s final reading as expected while the same data slumped to 49.7 in Germany. Despite the disappointing data, however, the euro remained supported by broad-based USD weakness.