The Uganda shilling oscillated at the now familiar levels of 3725/3745 against the U.S. dollar in yesterday’s session with minimal and balanced activity on both the demand and supply counters. Outlook is biased towards a stronger shilling with the USD/UGX trading at 3710/3750 ranges as forex activity expands amidst high levels of liquidity in the money market space. The overnight and 1 week interbank lending rates was running between 8.50-11.50 per cent and 10.0-12.0 per cent respectively.
Greenback slumps against rivals
The U.S. dollar fell against its rivals Monday after soft housing data pointed to a continued slowdown in the U.S. housing market. The weaker housing data arrived as investor expectations for December rate hike trickled lower over the past week even as New York Fed President John Williams said the Federal Reserve would continue hiking rates on a gradual pace.
The GBP/USD rose to $1.2854 after falling to session low of $1.2797 as the no-confidence threat against UK Prime Minister May eased when key members of her cabinet held off submitting a letter of non-confidence in the prime minister to see whether the Brexit deal would get voted down in parliament.
The Euro benefitted from dollar weakness, changing hands at $1.1451, in spite of apprehensions surrounding negotiations between Brussels and Italy over Italy’s free-spending budget, which goes against the European Union’s fiscal standards.