Market News
Uganda central bank sells FX after rate hike fails to stem shilling losses - REUTERS
NAIROBI, Oct 22 (Reuters) – Uganda’s central bank said in a notice to banks on Thursday that it was in the market selling an undisclosed amount of foreign currency.
“BOU (The Bank of Uganda) is in the FX market on the sell side,” the notice said, without elaborating.
Uganda’s currency, the shilling, has been under pressure for weeks, sliding to repeated record lows against the U.S. dollar.
To try to arrest the slide, the central bank hiked its main interest rate by 225 basis points to 12% last week after an emergency monetary policy meeting.
The shilling recovered some ground on the day the rate hike was announced, but it then resumed its losing trend and is now trading weaker than at the time of the hike.
