The Uganda shilling began the week on a depreciating trend, pressured by strong corporate dollar demand from the telecommunications, energy, and manufacturing sectors, according to Absa Bank Monday Market Report.
Limited dollar inflows offered little support to the local currency, which weakened to close at 3705/3715 compared to its opening levels of 3690/3700.
Liquidity conditions in the money market remained ample, buoyed by quarter-end government releases and the recent maturities. Consequently, overnight and one-week funds traded at average rates of 9.50% and 9.750%, respectively.
Despite the improved liquidity environment, the Bank of Uganda refrained from market intervention, leaving participants to establish price equilibrium.
