East Africa is the fastest-growing economic region on the continent. In 2022, Uganda, Kenya and Tanzania attracted over USD13.3 billion worth of foreign direct investment (FDI). This is according to the latest investment report by the business advisory firm Ernst & Young. The report singled out Uganda as having received USD10.2 billion — the highest in East Africa — creating 6,300 jobs. However, a refusal by a Ugandan Commercial Court to respect and enforce a London Court of International Arbitration (LCIA) ruling has turned on the stage lights onto Uganda’s investment climate and may position the country in a bad…
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The Uganda shilling continued on its strengthening trend joining a global rally amid weakness of the dollar. In the local market there was a general slump in demand while supply was mildly enhanced by end month flows mainly from exports . The unit was quoted at 3735/45. In the regional markets, the Kenya shilling was on the back foot trading at a new all time low of 122.20/40 on increased demand from the energy sector. In the fixed income market a treasury bill auction with 285 billion on offer was held. Yields remained relatively flat with BOU seen suppressing yields…
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The shilling traded flat on the back of thin import appetite underpinned by low business activity. Supply was boosted by cyclical remittances. The unit held at 3740/50. In the neighboring Kenya, the currency hit a fresh new low, undermined by huge dollar demand from manufacturing and energy sectors. KES was quoted at 121.85/122.05. In the global markets, the US dollar held ground as markets tried to make sense out of mixed US economic data. The greenback had tumbled in recent weeks on inflation and comments from the Federal Reserve signaling that the Central Bank could put brakes and slow the…
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The Uganda shilling continued to beat expectations and maintained a bullish stance supported by remittances and charities. The unit threatened to break lower the support level of 3750. In the fixed income market, a treasury bill auction with UGX285 billion on offer was held. Yields remained flat with Bank of Uganda cutting off outlier bids. The market bidding behavior reflects a return premium for the greater uncertainty over government fiscal situation. In the global markets, the dollar languished, losing significant value against many of its rivals following weaker than expected US CPI lowering expectation for aggressive Fed rate hikes going…
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The Uganda shilling reversed course and slightly strengthened as end month flows gave support amid subdued demand. The unit traded below the 3800 level for the first time in months. The shilling appreciation bias was expected to be short lived as economic variables in particular inflation painted a bleak picture going forward. In Kenya, the currency took a hit, trading at a fresh record low trading above 120, undermined by elevated demand from oil importers. In the bond market, upward pressure on yields took center stage as markets players slammed huge risk premium on the prices. The worsening fiscal outlook…
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The Uganda shilling firmed in thin trade. Activity was low on both counters. The unit was quoted at 3825/35 in most of the trading sessions of the week. In other peer markets , the narrowing of interest rate differential between the frontier markets and the US is continuing to cause mayhem as the relative interest rate return between local currencies and dollar assets diminish. In the global markets, the US dollar loomed over major peers as treasury yields peaked at multi year high. Gloomy data and down beat corporate outlooks dimmed investor risk appetite . In other major markets, focus…
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The Uganda shilling surrendered its previous gains on revived demand by local firms for imports amid the dollar supply dearth. The unit traded at 3830/40. In other peer markets most of the currencies generally stumbled as the US dollar continued its ascendancy. In the fixed income market, short term yields continued to soar triggered by rising interest rates as investors focused on the short end in the primary market while positioning for the repricing advantage. BOU was less tolerant of higher rates and was seen capping. On the global scene, the dollar climbed to a fresh 24-year peak. The greenback…
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The Uganda shilling marginally gained as it searched for a meaningful direction on either side of 3800 mark. The unit joined a global risk rally amid weakness in the US treasury yields and a dip in dollar value during the week. BOU defensive monetary policy signal also played in support of the shilling trend. In the fixed income market, yields on the 3 and15 year bond continued on the upward, presenting a challenge as the related costs of government borrowing continue to rise .Local investors were seen demanding a higher premium as the fiscal situation stays in focus. Out of…
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The Uganda shilling was caught in crossfire of a strengthening dollar as the local market stayed long USD. Markets remained cautious as weekly losses for risky assets were exacerbated by sterling’s decline in what was a volatile week in the financial markets. The unit held in the range of 3880/90. In fixed income market, yields continued to rise in line with uptick in headline inflation and on the back of currency depreciation. With tight fiscal conditions , government is expected to step up their borrowing efforts in the domestic market to fund a higher fiscal deficit. Short yields cleared at…
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The Uganda shilling was in a sideways consolidation phase with minor bearish pressure but was showing signs of reversing as pockets of demand kept emerging. The unit held in the range of 3820/30, while in Kenya, the unit continued to trade at an all time low of 120.55/75, on increased dollar demand from oil importers and the global dollar strength. In other African markets, the three African biggest economies of South Africa and Egypt were expected to raise interest rates over concerns of unanchored inflation and increased depreciation pressures on their currencies. In the global markets, the US dollar surged…
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