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MARKET UPDATE – AFRICA | <strong>February</strong> <strong>2015</strong><br />
- 4.9 %<br />
Uganda shilling<br />
depreciation monthon-month<br />
-16.4 %<br />
Uganda shilling<br />
depreciation yearon-year<br />
Shilling tumbles<br />
The shilling started <strong>2015</strong> by breaching its<br />
2,780 units of exchange to the US dollar<br />
support line (Q4, 2014). High dollar demand<br />
by oil importers has been cited as the driving<br />
factor in driving depreciation of the local<br />
unit. Balance of payment imbalances,<br />
aggravated by the situation in South Sudan,<br />
have also been central in keeping the shilling<br />
under immense pressure.<br />
Uganda Shilling vs USD Exchange<br />
EQUITY MARKET UPDATE<br />
Uganda Stock Exchange All Share<br />
Index<br />
Source: Bloomberg, StratLink <strong>Africa</strong><br />
+31.9 %<br />
All Share Index yearon-year<br />
change<br />
Source: Bank of Uganda, StratLink <strong>Africa</strong><br />
UGSE All Share Month-on-month<br />
+10.8 %<br />
All Share Index<br />
month-on-month<br />
change<br />
We expect Bank of Uganda to continue<br />
tightening liquidity in the money market to<br />
prop up the shilling.<br />
Average Overnight Interbank Rate<br />
Source: Bloomberg, StratLink <strong>Africa</strong><br />
Source: Bank of Uganda, StratLink <strong>Africa</strong><br />
The market began the year on an upbeat<br />
mode with the All Share Index surging by<br />
double digits both on a month-on-month<br />
and year-on-year basis to the close of January<br />
<strong>2015</strong>. Relatively strong performance by<br />
banking counters, notably Stanbic and Bank<br />
of Baroda, has been central in driving the<br />
market to a rally.<br />
16 | StratLink <strong>Africa</strong> Ltd.<br />
www.stratlinkglobal.com
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