The Uganda shilling closed a tad stronger against the U.S. dollar on Monday with the USD/UGX pair down to the 3680/3700 from the 3682/3702 levels on Friday.
Traders trimmed long greenback positions as local tax settlements by key players curtailed purchasing power for the dollar. Today, relatively parallel activity on both demand and supply counters is likely to typify the forex market.
The money market traded amidst fairly balanced liquidity as fixed income prepare for a primary bond auction this Wednesday.
The U.S dollar fell against a basket of major currencies despite a rise in retail sales for the first time in four months as a strong rally in Sterling added to downside momentum. The U.S. Commerce Department said on Monday that retail sales increased by 0.6% last month, well above economists’ forecast for a 0.4% increase.
The upbeat retail sales did little to help the dollar recover but participants remained confident that consumer spending will accelerate, given the strong labour market and recent tax cuts.
A sharp rise in the Cable above the 1.431 mark, weighed on the greenback as The Pound Sterling continued to benefit from the European Union and UK’s agreement on both divorcing terms and a 21-month post-Brexit transitory period.
The EUR/USD pair rose above the $1.2370 as German Finance Minister praised Emmanuel Macron’s courage in proposing euro zone reforms, as signs of resistance towards the French leader’s ideas grew among Chancellor Angela Merkel’s conservatives