Corporate demand subdues Uganda shilling

Friday, 22nd July, 2011

CORPORATE demand for dollars from the energy sector, with no supporting inflows, yesterday pushed the shilling to close lower at sh2,581/2,601.

“Some sizeable corporate demand seems to be driving market higher.

“We expect trade above 2,600 tomorrow (today) as demand continues to build up,” Dennis Mashanyu, a trader at Standard Chartered Bank, said yesterday.

Yesterday’s close was weaker than the relatively stronger 2,580/2,590 the shilling posted on Wednesday.

“The shilling fell because of manufacturers who were on the buy side,” Faisal Bukenya, a trader at Barclays Bank, said.

The downward movement of the local currency was observed the entire day, moving from sh2,579/2,599 in the morning to close at sh2,580.55/2,601 by 3:00pm in the afternoon.

Analysts predict sustained demand for the greenback, would keep the shilling trading above the 2,600 level in weeks to come.

By Samuel Sanya : The New Vision Newspaper