KAMPALA: The Ugandan shilling weakened on Tuesday, hurt by dollar appetite from manufacturing and telecom firms, and market players said the local currency was seen easing further due to demand from fuel importers.
At 1025 GMT, commercial banks quoted the shilling at 2,863/2,873, weaker than Monday's close of 2,858/2,868.
"We've had demand from telecoms and manufacturing players," said Faisal Bukenya, head of market making at Barclays Bank Uganda.
The shilling has been under pressure since the year started, also due to demand from commercial banks attracted by the dollar's global strength. Some banks have also been building dollar positions in preparation to pay dividends to their foreign shareholders.
The local currency has lost 3.4 percent of its value so far this month and is within sight of its all-time low of 2,901 hit in September 2011.
The central bank has vowed to curb the depreciation, some of which it blames on speculative activity in the market.
We're expecting demand from oil importers and retailers, so the outlook is of weakening," said Sage Daniel Muganza, trader at Centenary Bank.
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