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Ugandan shilling firm, still vulnerable to Western anti-gay law reaction
March 3, 2014 / 12:26 PM / 4 years ago

Ugandan shilling firm, still vulnerable to Western anti-gay law reaction

KAMPALA, March 3 (Reuters) - The Ugandan shilling edged up on Monday and traders said it remained susceptible to downward pressure from possible further Western penalties in reaction to the enactment of a harsh anti-gay law.

By 0957 GMT, commercial banks were quoting the currency of east Africa’s third-largest economy at 2,522/2,532, slightly up from Friday’s close of 2,528/2,538.

“The pressure on the shilling has eased off because much of the buying last week was driven by the interbank (demand) and demand there has died down,” Barclays head of market-making Faisal Bukenya said.

The shilling had been buoyant this year until early last week when some Western countries announced aid cuts in response to President Yoweri Museveni’s signing of the anti-gay bill.

Denmark and Norway said they were cutting aid while the World Bank announced it would withhold a $90 million loan in protest against the law, widely deemed to be draconian.

The shilling’s sharp depreciation prompted three consecutive days of central bank intervention to try to soak up demand for the greenback and steady the local currency.

“The market has not yet fully stabilised and I don’t think the shilling is out of the woods yet,” Crane Bank’s head of treasury Manohar Miryala.

“The shilling’s short term outlook is still dependent on news related to the new law and any response ... it’s a hot topic and, until we have some clarity, confidence in the shilling might remain weak.”

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....... (Reporting by Elias Biryabarema; Editing by Louise Ireland)

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