Ugandan shilling flat on tepid demand for dollars

KAMPALA: The Ugandan shilling was unchanged on Thursday amidst sluggish demand from banks and firms for dollars.

At 0901 GMT, commercial banks quoted the shilling at 2,995/3,005, unchanged from Wednesday's close.

Shahzad Kamaluddin, a trader at Crane Bank, said importers were waiting to see if the foreign exchange rate would come off in the event of the dollar weakening and the central bank propping up the local currency.

"Because of these factors corporate (firms) think there's room for the dollar to climb down so they're keeping on the sidelines," Kamaluddin said.

In recent weeks the shilling has largely traded around the 3,000 level, off its all-time low of 3,116/3,126 hit on March 12 on the back strong corporate demand for dollars and worries about the country's fiscal outlook.

So far this year the shilling is 7.7 percent weaker against the dollar.

Some traders say appetite for dollars, especially from importers, was likely subdued because of a slowdown in consumer spending.