Bloomberg News

Uganda Shilling Gains Most in a Week on Increased Dollar Inflows

July 13, 2011

July 13 (Bloomberg) -- Uganda’s shilling appreciated the most in more than a week against the dollar as inflows of the U.S. currency from sales of exports and from aid increased.

The currency of Africa’s second-biggest coffee producer gained for a second day, adding 0.6 percent, the biggest intraday jump since July 4, to 2,587.50 per dollar by 1:01 p.m. in the capital, Kampala.

“The dollar inflows have been good today, coming from the non-governmental organization sector and a bit from the export sector,” Faisal Bukenya, a currency trader at the local unit of Barclays Bank Plc, said by phone from Kampala, without providing further details. “There is little demand for the dollar as currently buyers because buyers think the shilling may appreciate.”

The central bank has sold dollars in the domestic foreign- exchange market at least four times since June 15 as the currency slumped to its weakest level since 1993 on June 30, making it the third-worst performer worldwide after Suriname’s dollar and Maldives’ rufiyaa. Inflation in the East African country accelerated to a 17-year high of 16 percent in May, before slowing to 15.8 percent last month.

--Editors: Ana Monteiro, Linda Shen

To contact the reporter on this story: Fred Ojambo in Kampala via Nairobi at pmrichardson@bloomberg.net.

To contact the editor responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net.


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