As of January 11, 2025, the Uganda shilling has continued to depreciate, closing at 3,695.05 against the US dollar. This marks a decline from 3,633.55 on December 19, 2024, when it was trading at 3,645.55 for selling [cc3b3ff8]. Mid-week, the shilling hit a low of 3,707 for selling, reflecting ongoing challenges in the currency market [cc3b3ff8]. The depreciation is attributed to a limited supply of dollars, primarily driven by high demand from the energy and manufacturing sectors, despite a temporary reduction in overall dollar demand during the festive season [cc3b3ff8].
In contrast, the Kenyan shilling has shown notable strength against the US dollar and other regional currencies, gaining 11.7% against the Ugandan shilling during the third quarter of 2024 [6587a01d]. As of January 10, 2025, the exchange rate was reported at KSh 129.48 per US dollar, while the Ugandan shilling traded at 25.58 against the Kenyan shilling [6587a01d]. The Kenyan shilling's stability has been bolstered by a significant increase in diaspora remittances, which rose by 19.2% in November 2024 [6bba9af1].
The Bank of Uganda recently held a Treasury Bond auction, with bonds yielding between 16.0% and 17.5%, and a total accepted amount of 791.17 billion shillings [cc3b3ff8]. The Euro remains stable at approximately 1.03 dollars, while oil prices have surged to a three-month high, reaching around 78 dollars per barrel [cc3b3ff8]. Analysts suggest that the economic policies of US President-elect Donald Trump may further impact the dollar and developing countries like Uganda [cc3b3ff8].
In summary, while the Kenyan shilling is experiencing gains, the Uganda shilling faces significant pressures due to a dollar supply shortage and sector-specific demand, highlighting the contrasting economic conditions within East Africa [6587a01d][cc3b3ff8].