The Bank of Uganda (BoU) has introduced a new financial market benchmark designed to improve transparency around the cost of foreign currency funding and strengthen price discovery in Uganda’s foreign exchange market.
The central bank announced the launch of the Uganda Foreign Exchange (FX) Swap Curve, which it said is being published for the first time as part of efforts to deepen and modernise the country’s financial markets.
The curve shows FX swap points for the Ugandan shilling against the US dollar across different maturities, providing market participants with an indication of the implied cost of obtaining US dollar funding through foreign exchange swaps.
It will cover maturities ranging from overnight to one year, specifically overnight, one week, two weeks, one month, three months, six months, nine months and one year.
The Bank of Uganda said the curve will be published daily through its Daily Money Market Report, allowing commercial banks, businesses, investors, policymakers and other financial market participants to access a common market reference.
An FX swap involves exchanging one currency for another at an agreed exchange rate and simultaneously agreeing to reverse the transaction at a specified future date. The cost of the transaction can change depending on market conditions, including interest-rate differentials, exchange-rate movements and liquidity.
According to the central bank, the new curve will therefore provide a clearer indication of foreign currency funding conditions across different periods.
Supporting pricing and risk management
BoU said the benchmark is expected to support the pricing of FX swap transactions and the valuation of financial positions, while also helping banks and businesses manage foreign exchange risks.
It will also provide market participants with additional information for assessing prevailing funding conditions and making financial decisions.
The central bank said greater availability of market pricing information should improve price discovery and efficiency in Uganda’s foreign exchange market.
The benchmark is based on quotations submitted by commercial banks, with participating institutions expected to provide timely and accurate quotations each business day.
BoU said it developed the curve in collaboration with commercial banks and the London Stock Exchange Group (LSEG).
A pilot exercise was conducted to test whether participating banks could consistently provide reliable quotations across the specified maturities before the benchmark was introduced.
The central bank said the initiative represents an important development in Uganda’s financial market infrastructure by establishing a reference point for foreign currency funding costs.
Daily market reference
The first published curve was reported as at August 6, 2026, at 5:00 p.m.
BoU, however, cautioned that the curve should be treated as a reference benchmark rather than a guaranteed transaction price.
Actual FX swap prices may differ depending on prevailing market conditions, liquidity and other commercial considerations, the central bank said.
The daily publication is expected to allow market participants to track changes in foreign currency funding conditions over time.
For businesses exposed to dollar-denominated transactions, commercial banks managing foreign exchange positions and investors assessing currency-related risks, the benchmark could provide an additional reference when evaluating the cost of foreign currency funding.
BoU said the initiative will ultimately contribute to more informed decision-making, stronger price discovery and the continued development and resilience of Uganda’s financial system.
The Uganda FX Swap Curve will be available through the Bank of Uganda’s Daily Money Market Report.