Bloomberg News

Uganda Shilling, World’s Worst Performer, Heads for Weekly Drop

July 22, 2011

July 22 (Bloomberg) -- Uganda’s shilling, the world’s worst-performing currency over the past month, was set for a weekly decline against the dollar amid increased demand for the U.S. currency from domestic banks.

The currency of Africa’s second-biggest coffee producer fell 0.6 percent to 2,600 per dollar at 2.56 p.m. in Kampala, the capital, bringing its decline so far this week to 1.9 percent, according to data compiled by Bloomberg. It closed at 2,585 yesterday.

“The shilling weakened slightly because of demand in the interbank market,” Benon Okwenje, a currency trader at Stanbic Bank Uganda Ltd., said by phone from Kampala. The buying of dollars may be linked to “customer demand or to close up their positions.”

The shilling has depreciated 11 percent this year, ranking it as the world’s third-worst performing currency, as inflation accelerated to a 17-year high.

--Editors: Paul Richardson, Ana Monteiro.

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: Paul Richardson at pmrichardson@bloomberg.net.


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