On Monday, the Ugandan shilling showed some volatility in trading, initially opening at levels of 3723/3733. It then strengthened briefly to 3710/3720, a movement attributed to interbank selling and month-end inflows.
Catherine Kijjaggulwe, head of trading at Absa, noted that the shilling faced some pressure in the afternoon due to increased demand. As a result, the currency ended the day near its opening levels, closing at 3720/3730.
The money markets remained relatively stable, with overnight yields averaging 9.75%. Traders are anticipating the July inflation report, scheduled for release on July 31, 2024, which could influence future currency movements.
Additionally, the Bank of Uganda is planning a treasury bill auction on Wednesday, July 31, 2024, which may impact liquidity and interest rates.
In the regional context, the Kenyan shilling showed some improvement on Monday, trading at 131.50. This was a recovery from previous lows of 133.50/134.50, supported by increased inflows and intervention from the Central Bank, which sold currency to bolster its value.
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