As the week came to a close, the Uganda Shilling experienced a slight weakening against the US Dollar, settling at 3,805/3,815 compared to the previous week’s closing rate of 3,799/3,809.
Throughout the week, the local currency showed a sideways movement, fluctuating within the range of 3800-3815. Richard Nsubuga, a trader from Absa Bank, noted a balanced flow of activity in the market as the weekend approached.
According to Nsubuga, factors such as tightness in the money markets contributed to the shilling’s performance during the week. He anticipates that the currency pair will continue to trade within the range of 3790 – 3850 in the near future.
Stephen Kaboyo, the managing director at Alpha Capital, provided insights into the currency market’s expectations, suggesting that investors are adopting a wait-and-see approach, anticipating the next significant market driver. Forecasts indicate a period of sideways trading for the local unit as investors seek to capitalize on potential gains.
During Friday’s trading session, overnight trades averaged 12.09%, indicating ongoing tightness in shilling liquidity. This liquidity constraint continues to influence the shilling’s movement in the market.
Overall, the week’s performance reflects the dynamic nature of currency trading, influenced by various internal and external factors. As traders and investors navigate these fluctuations, they remain vigilant for opportunities and potential risks in the currency market.
