The local currency continued on its upward trajectory, trading closer to a key resistance level of 3,550 as demand slumped. The Central open market operations also assisted in keeping market liquidity levels in check.
In other market moving news, word was out that the Government of Uganda had applied to the International Monetary Fund for US$900 million to bolster its finances as the pandemic continued to wreak havoc on the economy.
Regional Market
In the regional markets, the Kenya shilling firmed slightly due to subdued demand for dollars from importers and inflows from offshore investors participating in the bond auction. Trading was in the range of 106.95/107.00
In global markets, the US dollar hit a two week high as risk appetite faded amid a selloff in stocks, following remarks by Secretary Janet Yellen that interest rates may have to rise to prevent the US economy from overheating. In other major currencies the Euro fell 0.4% against the dollar, while the sterling suffered a similar fate ahead of Bank of England announcement to announce a slowdown in its bond buying program.
In the coming days, the shilling is expected to trade within the current levels, with a slight chance of appreciation on anticipated decline in demand.
