BUSINESS NEWS (UGNEWSLINE) – The Uganda shilling remained under pressure against the dollar, depreciating to 4205 / 4215 from opening levels of 4180 / 4190. The local unit’s weakness was largely attributed to persistent corporate demand for dollars, particularly from importers and players in the energy sector, against a backdrop of limited hard currency inflows.
The imbalance between robust dollar demand and subdued supply continued to weigh heavily on the shilling throughout the trading session.
Meanwhile, liquidity conditions in the money market stayed tight as the effects of the recent increase in the Central Bank Rate continued to absorb shilling liquidity from the banking sector. Consequently, funding pressures remained elevated, with overnight and other short-term interest rates edging higher to trade within the 12.00% – 12.50% range.
Yields at today’s Treasury bill auction moved higher across all the tenors, with a total of UGX 372.55 billion in face value accepted against an offered amount of UGX 350 billion, reflecting robust demand. The 91-day, 182-day and 364-day maturities rose by 155bps, 265bps and 300bps to clear at money market yields of 11.249%, 13.400% and 14.499%, respectively.
