The Uganda shilling gained 4.3 percent against the dollar through August 2025, marking its strongest annual performance among regional currencies, as commodity exports and investor purchases supported the exchange rate. The Bank of Uganda reported net foreign currency inflows climbed to 73.3 million dollars from 23.7 million dollars one year earlier, with coffee, cocoa and gold sales generating steady reserves.
The currency outpaced the Kenyan shilling, which fell 4.9 percent, and the Rwanda franc, which dropped 8.9 percent amid financing pressures. Tanzania and South Africa recorded losses of 2.8 percent and 2.7 percent, respectively, while Uganda posted gains exceeding China, India, and Indonesia.
The central bank attributed stability to controlled inflation and disciplined fiscal management. Gold exports and remittances maintained reserve levels as portfolio investors bought government securities.
Authorities warned that reduced aid from Britain and the Netherlands could weaken the shilling. Lower coffee prices from increased harvests in Brazil, Vietnam and Indonesia may cut export earnings while Middle East tensions threaten shipping costs.
The currency outpaced the Kenyan shilling, which fell 4.9 percent, and the Rwanda franc, which dropped 8.9 percent amid financing pressures. Tanzania and South Africa recorded losses of 2.8 percent and 2.7 percent, respectively, while Uganda posted gains exceeding China, India, and Indonesia.
The central bank attributed stability to controlled inflation and disciplined fiscal management. Gold exports and remittances maintained reserve levels as portfolio investors bought government securities.
Authorities warned that reduced aid from Britain and the Netherlands could weaken the shilling. Lower coffee prices from increased harvests in Brazil, Vietnam and Indonesia may cut export earnings while Middle East tensions threaten shipping costs.
