Plunging below 4,300 UGX per USD! The Ugandan shilling plummets dramatically—retail exchange rates breach 4,400!

On October 22, 2026, local time, the Ugandan shilling—the official currency of Uganda—hit a record low against the US dollar in the interbank foreign exchange market, falling below 4,300 shillings per USD during intraday trading. Retail foreign exchange markets serving individual customers exhibit wider spreads; some commercial banks’ USD selling rates exceeded 4,400 shillings per USD. Exchange rate statistics indicate that over the past 12 months, the Ugandan shilling has depreciated nearly 20% against the US dollar. On October 14, 2026, the Bank of Uganda (BOU) raised its benchmark interest rate by 225 basis points, tightening monetary policy to stabilize the local currency’s exchange rate. Nevertheless, following this rate hike, the shilling continued its downward trend against the US dollar. On October 22, the BOU intervened in the foreign exchange market by selling US dollars to commercial banks to slow the shilling’s depreciation. The scale of this foreign exchange intervention was not disclosed publicly. The BOU remains cautious in deploying its foreign exchange reserves; this intervention provided only short-term support to the exchange rate. Imbalance between supply and demand in the foreign exchange market is the primary driver behind the shilling’s recent depreciation.

Latest News from Uganda (October 21)

01 Uganda Seeks EU Investment in Energy Sector Uganda is leveraging the Uganda–EU Business Forum to attract European Union investment in its energy sector, with an aim to achieve 20,000 megawatts of installed power generation capacity by 2040 and build a $500 billion economy. In the 2026–2027 fiscal year, Uganda has allocated 2.1 trillion shillings for energy development, advancing hydropower, solar photovoltaic, and other energy projects. Uganda is urging European companies to invest in domestic manufacturing, while the EU will provide financing support under its Global Gateway strategy. 02 Overloaded Substations Trigger Power Outages According to the Uganda Electricity Distribution Company (UEDCL), persistent blackouts stem from a combination of aging grid infrastructure, overloaded substations, vandalism of facilities, and surging electricity demand. Both the number of electricity customers and overall power consumption have risen sharply in recent years, yet grid investment remains severely inadequate. The company plans to upgrade multiple substations to alleviate supply pressure. 03 Ugandan Banks Sell Dollars to Stabilize Shilling The Bank of Uganda (BOU) sold $30 million from its foreign exchange reserves to ease depreciation pressure on the shilling—the first such foreign exchange intervention since June 2022. Prior to this, the central bank had raised its benchmark interest rate to 12%, briefly boosting the exchange rate. However, the shilling remains under pressure, with depreciation driven by rising oil prices and declining foreign capital inflows. 04 Museveni Urges Diaspora to Return and Invest Ugandan President Yoweri Museveni has called upon Ugandans living in Australia, New Zealand, and the broader Australasian region to invest in agriculture, manufacturing, and technology sectors to support national economic transformation. The government pledges to improve the business environment and prioritize transport infrastructure development, while also emphasizing the protection of indigenous cultural heritage. Uganda’s cooperation with Australia continues to expand across mining, education, and tourism sectors.

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