The Uganda shilling has shown sharp volatility in the past few weeks, which analysts attribute to primarily on seasonality factors.
Past trends indicate that midyear; there is usually a higher need of foreign exchange caused by dividend repatriation. This combined with the latest donor backlash; the sentiment is negative for the shilling.
Trade levels indicate support established at Ugx 2,625 and likely to hold.
According to Stephen Kaboyo, the Alpha Capital markets boss, the undercurrent is of a weaker shilling until pressure of seasonal factors subsides.
The current conditions may prompt BOU to intervene on the sell side to address the volatility.