Ugandan shilling steady after central bank mops up liquidity

By Elias Biryabarema

KAMPALA (Reuters) - The Ugandan shilling held steady on Friday, supported by the central bank mopping up liquidity via repurchase agreements.

At 1048 GMT commercial banks quoted the currency of east Africa's third-largest economy at 2,525/2,530, little changed from Thursday's close of 2,528/2,533.

Ahmed Kalule, a trader at Bank of Africa, said the central bank's move to mop up liquidity had reduced demand in the market for a globally weaker dollar, propping up the shilling.

The Bank of Uganda had been injecting liquidity into the market using reverse repos, which weakened the shilling in recent sessions.

A tight monetary policy stance by the central bank this year has kept private sector credit expensive, limiting consumer spending and helping the local currency strengthen this year.

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Source: http://news.yahoo.com/ugandan-shilling-steady-central-bank-mops-liquidity-111230541--business.html
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