Kampala/Nairobi – The Ugandan shilling was stable yesterday, unresponsive to the central bank slashing its key lending rate by a percentage point to 16 per cent, but traders said it was seen weakening in coming days. Commercial banks quoted the shilling at 3,360/3,370, unchanged from Friday’s close.

"We expect the local currency to react in the form of depreciation,” said Benon Okwenje, a trader at Stanbic Bank, adding that other factors like an uptick in dollar inflows could keep the shilling in the 3,360-3,380 range in the days ahead.

Meanwhile, the Kenya shilling was also unchanged against the dollar yesterday, with business activity subdued in early month trade.

The Kenyan unit was quoted at 101.45/55 to the dollar, unchanged from Friday’s close. The shilling has appreciated about 0.7 per cent against the dollar so far this year.