KAMPALA: The Ugandan shilling was a touch weaker on Wednesday, weighed down by demand for dollars from commercial banks and importers, although the local currency was seen recouping losses from offshore inflows.
At 1108 GMT commercial banks quoted the shilling at 2,605/2,615, weaker than Tuesday's close of 2,602/2,612.
"Some players in the interbank have been exerting demand and it has pushed the shilling higher (weaker)," Faisal Bukenya, head of market making at Barclays Bank, said.
The shilling is down 3.3 percent against the greenback this year and market analysts say it could face extra pressure in the coming weeks from an anticipated surge in demand from importers shipping in goods for Christmas shopping.
Ahmed Kalule trader at Bank of Africa said the market was likely to receive inflows from offshore investors who participated in Wednesday's auction as they start doing conversions to pay up for their bids.
"The shilling will likely pull back from these losses if those inflows start to come in."
At Wednesday's auction worth a combined 180 billion shillings ($69.15 million), the yield on the 2-year bonds edged up although the rate on the fifteen-year tenor declined.
Some traders had said the two-year bonds were likely to attract stronger appetite from offshore investors.
Investors who put in bids for the two securities are expected to pay up on Thursday.
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