Ugandan shilling stable, seen weaker on high liquidity

KAMPALA (Reuters) - The Ugandan shilling was treading water on Friday but market players expected some weakening next week as excess local currency liquidity spurs an uptick in demand for dollars.

At 1128 GMT commercial banks in the capital Kampala quoted currency of east Africa's third-largest economy at 2,588/2,598, unchanged from Thursday's close.

"The market outlook suggests that the shilling could be vulnerable on account of improved liquidity levels well into next week," said Stephen Kaboyo, managing director of Alpha Capital Partners.

"Offshore interests as a source of supply of dollars to the domestic market may also be waning as global bond yields pick up. Trading levels are expected in the range of 2,590/2,600."

Bank of Uganda (BoU) is on Wednesday due to sell Treasury bills of all maturities worth 90 billion Ugandan shillings.

Money market analysts say the shilling, which has mostly oscillated in the 2,500-2,610 range this year, is likely to draw support in the short to medium from the central bank's cautious monetary policy.

Citing fears over a possible upsurge in food prices fuelling inflationary pressures, the Bank of Uganda this month left its key lending rate unchanged at 11 percent, from June.

Source: http://news.yahoo.com/ugandan-shilling-stable-seen-weaker-high-liquidity-130459700.html

bracket Jason Terry Steubenville rape Beyonce Bow Down Jason Molina UCF Pigeon Forge Fire