The Uganda shilling was marginally weaker against the dollar in today’s session, with the pair closing at 3775 / 3785, compared to opening levels of 3770 / 3780, according to Absa Bank market report for Wednesday.
The slight depreciation was driven by corporate dollar demand, which moderately outpaced existing hard currency supply in the market. As a result, the local unit came under mild pressure throughout the day’s session but showed signs of recovery towards market close.
Money markets were liquid today, with overnight and one-week funding rates averaging at 9.75% and 9.90%, respectively. Despite the ample liquidity conditions, Bank of Uganda refrained from its liquidity management operations.
Yields at today’s Treasury bill auction eased for the 91-day and 182-day tenors, while the 364-day paper remained unchanged at 10.999%. The 91-day and 182-day bills cleared largely in line with market expectations at 9.749% and 9.999%, respectively, representing declines of 25.3bps and 25bps from the previous auction.