KAMPALA, Uganda–The Uganda shilling ended the week on a stronger note against the U.S dollar as interbank players unwound long dollar positions amidst reduced foreign currency demand as corporate firms settled mid-month tax obligations.
The USDUGX pair shed off a few shillings to close within the 3682/3702 band from previous comfort 3685/3705 levels.
This week, a relatively stable pair is expected as greenback demand wanes. The Central bank maintains presence in the primary bond market seeking Ugx 220Billion via a 2 year (new) bond auction and a 5 year (re-open) bond auction slated for Wednesday this week.
The U.S. Dollar ended the week little changed against a basket of the other major currencies as investors awaited more clarity on possible Western military strikes in Syria. The U.S dollar index, which measures the greenback’s strength against a basket of six major currencies, was at 89.51 in late trade and down by 0.31% for the week.
The Euro traded flat late Friday, with the EUR/USD at 1.2330 levels, snapping four days of gains. The single currency still notched up a weekly gain of 0.48% after comments by European Central bank officials reinforced expectations that the bank is on track to normalize monetary policy.
The Sterling was a touch higher against the greenback, with GBP/USD settling at 1.4238 after rising to a ten week high of 1.4297 earlier amid expectations for a rate hike by the Bank of England as soon as next month.