KAMPALA: The Ugandan shilling was little changed on Monday but is expected to strengthen as importing firms remain on the sidelines awaiting the dollar to weaken before buying.
At 0926 GMT, commercial banks quoted the shilling at 2,613/2,623, a notch up from Friday's close of 2,615/2,625.
"Most players are betting the shilling still has room to climb," said Faisal Bukenya, head of market-making at Barclays Bank Uganda.
"We are going to see a lot of players keep on the sidelines which could push the shilling to 2,600 levels."
Market participants said the shilling, which is down 3.6 percent in the year to date, could be cushioned from further pressure by weaker demand in the wider economy.
"Consumer spending is weak which might explain the very slow appetite (for dollars) we are seeing from importers," said Shahzad Kamaluddin, trader at Crane Bank .
The central bank is scheduled to set lending rates for August and September on Thursday and traders said a small cut of about 0.5 percentage points is likely to be made to the current rate of 11 percent.
Comments
Comments are closed.