The central bank of Uganda on Wednesday released it’s opening foreign exchange rates.
The Rwandan franc is buying at 2.95 and sold at 2.98.
The Kenyan shilling is being bought at 33.66 and is selling at 33.82.
As October concludes, the Ugandan Shilling (UGX) has dropped in value losing over 11%-13% and is down by 26.73% over the last 12 months.
By Wednesday, the Uganda shilling is being bought at 438.00 per U$ Dollar.
Few days ago it had crumbled to 4510 per U$ Dollar.
What Is Uganda Doing ?
The country’s policymakers are battling currency weakness and rising inflationary pressures.
The government has turned to its thin foreign exchange reserves as the shilling slides.
Uganda’s foreign-exchange reserves are estimated at about U$6.7 billion. This can only enable Uganda to import for three months.
East African Community benchmark is to have reserves that can enable a member state import for 4.5months.
Uganda’s reserves of U$6.7, are below the EAC recommended amount.
President Yoweri Museveni doesn’t believe in depleting foreign reserves to stabilise the shilling.
Instead he prefers reducing imports and boosting export and tourism earnings to strengthen the economy.
Meanwhile, higher oil prices increase Uganda’s demand for foreign currency to pay for imports, potentially worsening pressure on the shilling and reserves.
