Ugandan shilling firm, T-bill sale inflows to give further boost

KAMPALA Wed Feb 5, 2014 4:49am EST

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KAMPALA Jan 5 (Reuters) - The Ugandan shilling strengthened slightly on Wednesday, helped by expectations of increased foreign currency inflows from offshore investors taking part in a Treasury bill sale.

At 0809 GMT commercial banks quoted the shilling at 2,470/2,475 to the dollar, marginally stronger than Tuesday's close of 2,473/2,478.

"What is driving the market is sentiment... players are expecting healthy inflows into today's auction and that explains the market's confidence in the shilling," said Faisal Bukenya, head of market making at Barclays Bank Uganda.

The Bank of Uganda (BOU) will release later on Wednesday results of a Treasury bills auction in which 165 billion Ugandan shillings ($67 million) worth of paper of all maturities are on sale.

Ahmed Kalule, trader at Bank of Africa, said the central bank keeping its key lending rate for February unchanged could also have helped boost confidence in the shilling.

"If we had had a cut, certainly the shilling's strengthening bias would probably have been reversed," he said.

"The rate decision, added to the weak demand (for dollars) in the market favours the shilling's outlook."

The central bank left its benchmark Central Bank Rate for this month unchanged, citing a rise in household consumption.

Kalule said the shilling would likely trade in the 2,465-2,495 in the coming days.

UGX Spot Rate.....

Ugandan Shilling Money Guide....

Calculated Cross Rates..........

Deposits.....................

Deposits & Forwards.............

Uganda Equities Guide.......

Uganda All Share Index........

Shilling background .....

Ugandan Debt Guide............

All Uganda Bonds.............

Uganda T-Bills..............

Uganda Benchmark.............

Central Bank ................

Ugandan Contributor Index....

Uganda Coffee Prices....... ($1 = 2477.0000 Ugandan shillings) (Reporting by Elias Biryabarema; Editing by Toby Chopra)

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