KAMPALA, Feb 3 (Reuters) - The Ugandan shillingUGX= was unchanged in slow trading on Monday but was seen strengthening later in the week on market expectations of a liquidity squeeze after a larger-than-usual debt sale. Traders were awaiting a central bank policy meeting on Tuesday but expected the bank to keep its benchmark interest rate on hold. At 0818 GMT commercial banks quoted the shilling at 2,473/2,478 to the dollar, unchanged from Friday's close. "This week's auction is comparatively large ... we're expecting some shilling scarcity to set in after the sale and it might push the shilling to around 2,460 levels," said Ahmed Kalule, trader at Bank of Africa. "Some players are also eyeing the rate decision before taking positions but the general sentiment favours a strong shilling in anticipation of a rate hold." The central Bank of Uganda is due to sell 165 billion shillings ($66.67 million) worth of Treasury bills of all maturities on Wednesday and it is also due to announce this month's monetary policy rate on Tuesday. Most traders forecast the bank is likely to leave the rateUGCBIR=ECI unchanged despite an increase in inflationUGCPIY=ECI because hiking it would undermine the bank's effort to bring down commercial banks' lending rates. Year-on-year headline inflation last month edged up to 6.9 percent from 6.7 percent in December, while core inflation, which the central bank targets, declined to 4.6 percent from 5.7 percent. Faisal Bukenya, head of market making at Barclays Bank Uganda, said the shilling's tone also remained bullish because of soft demand for dollars from corporate clients. UGX Spot Rate.....UGX= Ugandan Shilling Money Guide....UGX/1 Calculated Cross Rates..........UGXX= Deposits.....................UGXDEPO= Deposits & Forwards.............UGXF= Uganda Equities Guide.......UG/EQUITY Uganda All Share Index.........ALSIUG Shilling background .....UGX/BKGDINFO Ugandan Debt Guide............UG/DEBT All Uganda Bonds.............0#UGTSY= Uganda T-Bills..............0#UGTSYS= Uganda Benchmark.............0#UGBMK= Central Bank ................BOUGINDEX Ugandan Contributor Index....UG/CONT1 Uganda Coffee Prices.......COFFEE/UG01 ($1 = 2475.0000 Ugandan shillings) (Reporting by Elias Biryabarema; Editing by George Obulutsa and Susan Fenton) ((nairobi.newsroom@reuters.com)(Tel: +254 20 221 4608)) Keywords: UGANDA CURRENCY/
Ugandan shilling flat, seen strengthening on tight liquidity
KAMPALA, Feb 3 (Reuters) - The Ugandan shilling UGX= was unchanged in slow trading on Monday but was seen strengthening later in the week on market expectations of a liquidity squeeze after a larger-than-usual debt sale. Traders were awaiting a central bank policy meeting on Tuesday but expected the bank to keep its benchmark interest rate on hold. At 0818 GMT commercial banks
February 3, 2014




















