KAMPALA, Aug. 12 (Xinhua) -- The Ugandan shilling depreciated by 3 percent against the U.S. dollar in the first five months of 2020 due to increased outflows of investment following the COVID-19 outbreak, a new report said Wednesday.
Bank of Uganda, the country's central bank, in its monetary policy report for August 2020 released earlier in the day, said the pandemic forced foreign investors to take out their investment from Uganda.
The report showed that as a result of global financial markets turbulence and the rush by investors to hold dollars, the exchange rate depreciated from an average of 3,676.9 shillings per dollar in February to 3,918.1 shillings per dollar on March 24.
Since May, however, the shilling has appreciated by 2.3 percent, owing to increased inflows from forex bureaus, foreign financed non-government organizations, remittances and offshore players, the report said.
Adam Mugume, executive director of research from Bank of Uganda, also said attractive yields of government securities combined with stable macroeconomic outlook have attracted the portfolio inflows.