KAMPALA: The Ugandan shilling was unchanged on Monday, but traders said it was seen firming slightly due to the central bank's action of mopping up excess liquidity from the market.
At 0847 GMT commercial banks quoted the shilling at 2,620/2,630, little-changed from Friday's close of 2,621/2,631.
The Bank of Uganda or central bank on Monday sought to mop up excess liquidity via repurchase agreements, but it was not immediately clear how much shillings were taken out.
Draining excess liquidity makes it more expensive for banks to hold long dollar positions.
The shilling had lost ground on Friday after President Yoweri Museveni sacked his former ally and prime minister, sparking a rise in demand for the greenback as investors sought a safe haven, weakening the shilling.
"The central bank is doing a mop-up, it's possible the shilling might derive some support," said Faisal Bukenya, head of market making at Barclays Bank.
Traders expect the local currency - which has lost 3.8 percent against the dollar so far this year - to trade between 2,615 to 2,635 during this week.
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