The Uganda shilling extended its gains against the US dollar in Thursday’s trading session, appreciating from opening levels of 4100 / 4110 to an intraday high of 4020 / 4030 before closing the day at 4040 / 4050.
According to Absa Bank Uganda daily updates, the rally was largely driven by subdued dollar demand, as most corporate players remained on the sidelines, helping to alleviate pressure on the local unit and support its continued appreciation.
In the money markets, liquidity conditions tightened further as most interbank participants conserved their shilling positions ahead of tomorrow’s RTGS system closure by the central bank for the upcoming long weekend. The resulting squeeze in funding liquidity saw overnight rates climb to as high as 13%.
