Ugandan Economist’s 2024 Shilling Prediction Plays out as Dollar Reaches Shs3,900
The shilling’s movement is coming amid pressure from both local and international factors.
Ugandan manufacturers and energy companies need dollars to pay for machinery, fuel, raw materials and other imports, according to BoU officials quoted by the media.
Some businesses, such as car dealerships, are also buying dollars in anticipation of higher costs, increasing demand for the US currency.
At the same time, fighting in the Middle East, leading to the closure of the Strait of Hormuz by Iran and attacks by Yemeni fighters in areas surrounding the Bab Al Mandab strait in recent days, has pushed up oil and shipping costs.
Uganda imports 100% of its refined petroleum products, meaning higher international oil prices increase the amount of foreign currency needed to pay for fuel.
That can eventually affect ordinary Ugandans through higher transport, food and production costs.
