KAMPALA, Uganda–The Uganda shilling held steady at the 3680/3700 levels against the U.S. dollar on Tuesday, bolstered by low appetite for hard currency from key players as tight liquidity keyed into the local money market arena.
The Central Bank injected Ugx 170.5 bio in the money market via a 2 day reverse re-purchase agreement in a bid to ease tensions surrounding liquidity.
Today, market charter alludes to a relatively stable USD/UGX pair as activity on the forex counters wanes. In the bond market, Bank of Uganda offers Ugx 100 billion and Ugx 120 billion under the 2 year and 5 year bonds auctions respectively.
The U.S dollar rebounded against a basket of major currencies from a slump in the previous day as positive U.S. economic data lifted sentiment. The Commerce Department reported a 1.8% rise In U.S. home building to a seasonally adjusted annual rate of 1.319 million units in March, beating economists’ estimates for an increase to 1.270 million. In addition, Industrial production rose by 0.5% in March, topping economists’ forecast for a 0.3% rise.
The Euro continued to fall, with the EUR/USD down 0.26% to 1.2347.The euro came under some selling pressure after a report showed that German economic sentiment deteriorated sharply again in April amid concerns over heightened international trade tensions.
The Pound eased back from 22-month highs against the dollar after UK jobs data on Tuesday showed that wage growth missed estimates. The GBP/USD fell 0.17% to 1.4314.