KAMPALA: The Ugandan shilling inched up on Friday but was seen holding steady next week amid low demand.
At 0841 GMT commercial banks quoted the currency of east Africa's third-largest economy at 2,580/2,590, stronger than Thursday's close of 2,585/2,595.
"Next week I reckon with demand on the corporate side still weak and shilling supply also a bit tight we could see some further gains or range-bound trading," said David Bagambe, trader at Diamond Trust Bank.
Some money market analysts say the central bank is likely to intervene again next week and pump cash into the market to ease the scarcity of the local currency, a move likely to undermine any potential for gains.
Bank of Uganda this week issued a reverse repo that helped loosen liquidity but players say supply remains somewhat tight.
A market note from Alpha Capital Partners, a fund management firm, said weak fundamentals like the growing current account deficit clouds the shilling's outlook in the medium term.
"In the coming week we are likely to see the shilling hold steady buttressed by low demand in a square market," it added.
Traders said the local currency would oscillate in the 2,585/2,600 range.
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