The Ugandan shilling was the sole East African Community currency to appreciate against the U.S. dollar in June, lifted by robust foreign exchange inflows from commodity exports and offshore investors, the Ministry of Finance has reported.
In its Performance of the Economy Report released on Friday, July 24, 2026, the Ministry said the shilling strengthened by 1.4% against the dollar over the month. That performance put Uganda ahead of its EAC peers, most of whom saw their currencies lose ground.
“Among the EAC Partner States, the Ugandan Shilling was the only currency that registered an appreciation against the U.S. Dollar, strengthening by 1.4 percent,” the report, seen by http://Julisha.co.ke/subscriptions, stated.
The gains were driven by increased dollar supply from commodity exporters and portfolio inflows, which more than offset corporate and importer demand for foreign exchange.
The rest of the region moved the other way. The Tanzanian shilling depreciated by 0.8% in June, the Rwandan franc eased by 0.13%, and the Burundian franc slipped by 0.14%. The Kenyan shilling was largely unchanged, recording a marginal 0.05% movement against the dollar.
“The Tanzanian Shilling, Rwandan Franc, and Burundian Franc depreciated by 0.8 percent, 0.13 percent, and 0.14 percent, respectively,” the Ministry said.
“The Kenyan Shilling remained relatively stable, with a negligible movement of 0.05 percent against the U.S. Dollar.”
The Ministry noted that comparable data for the Democratic Republic of Congo, South Sudan and Somalia was not available for June.
What supported the shilling
Uganda’s currency resilience in recent months has been anchored on export receipts, particularly from gold. Strong gold shipments have boosted dollar inflows, helping to balance demand from businesses importing fuel, machinery, and other essential goods.
In addition to commodity earnings, the report pointed to offshore investor activity as a key factor. Portfolio inflows added liquidity to the forex market in June and helped absorb pressure from importers.
The combination meant that despite ongoing demand for dollars to pay for fuel and capital equipment, the market had enough supply to allow the shilling to post a modest gain.
A mixed picture across the EAC
The divergence underscores how differently EAC economies are experiencing forex pressures this year.
Tanzania recorded the steepest decline among the tracked currencies at 0.8%. Rwanda and Burundi posted smaller depreciations of 0.13% and 0.14% respectively. Kenya, after a turbulent 2024, appears to have stabilized, with the shilling barely moving against the dollar last month.
Analysts say Kenya’s relative stability reflects improved dollar inflows and tighter monetary conditions, while Tanzania’s weaker performance may be linked to higher import demand and softer export receipts in June.
For Rwanda and Burundi, the marginal declines suggest fairly balanced markets, but with less external support than Uganda is currently enjoying.
Outlook hinges on commodities and inflows
Uganda’s near-term currency outlook will likely remain tied to global commodity prices and the pace of export receipts. Gold has been the standout, but coffee and other agricultural exports also contribute to dollar supply.
At the same time, demand pressures from fuel imports and infrastructure-related purchases will continue to weigh on the market. The Ministry did not give a forecast, but said forex conditions would depend on global price movements, investor sentiment, and the government’s import bill.
If commodity prices hold and offshore interest remains, the shilling could retain its relative strength into the second half of 2026. A drop in export earnings or a surge in import demand, however, could quickly reverse the trend.
