The Uganda shilling gained momentum against the dollar in Monday’s trading session that saw ample dollar supply.
The USDUGX currency pair was steady in the morning session. Dollar sellers raided the local foreign exchange market in the afternoon session amid waning dollar demand, to help the local unit appreciate 5 shillings on the day.
Looking ahead, the home unit may continue to be supported by foreign currency inflows that have been witnessed in the recent past.
The U.S. dollar benefitted from safe-haven flows as it gained against the majors on Monday, after the U.S.
President Donald Trump authorized the usage of an emergency crude stockpile in response to drone attacks on Saudi oil refining facilities.
Oil prices jumped as much as 15% following the drone strikes, which knocked out more than 5% of global oil output. Trump’s decision saw a pullback in crude prices and reduced anxiety about a disruption in global energy supply.
The euro was weaker against the dollar as a result of surging oil prices, which weigh on Eurozone balance of payments, as Europe imports most of its oil.
The pound retreated from previous session highs on a widening U.K.-E.U. rift over Brexit. Just after a meeting with his U.K. counterpart Boris Johnson, Luxembourg Prime Minister Xavier Bettel lashed out at Johnson for failing to propose alternatives to unlock a Brexit deal before the Oct. 31.