KAMPALA Nov 22 (Reuters) - The Uganda shilling fell against the dollar on Tuesday, under pressure from energy sector dollar demand, but traders bet it would stay strong on inflows from the charity sector and Ugandans sending money home from overseas. An aggressive round of monetary policy tightening by Bank of Uganda (BoU) has seen the currency of one of Africa's top coffee exporters come off its Sept. 23 record low of 2,901 against the dollar. At 0750 GMT commercial banks quoted the shilling at 2,525/2,535, down from Monday's close of 2,510/2,520. "A range of importers were buying dollars this morning but mainly from the energy sector, which I think is bringing in fuel supplies for Christmas festivities," Ahmed Kalule, a treasury dealer at Bank of Africa, said. The shilling has recovered 12.8 percent of its value against the dollar since its record low in September. BoU says that hiking the benchmark Central Bank Rate (CBR) four times since July has drawn offshore investors into its debt market, supporting the shilling's rebound. The bank cranked up the rate to 23 percent this month from October's 20 percent and said it was prepared for more rises if consumer prices continued to rise. "The sentiment is for a strong shilling as significant inflows of dollars are expected from the diaspora towards the end of the year," a market report from Barclays Bank Uganda said on Tuesday. "The local unit is expected to break the 2,500 psychological level within the week as NGOs sell dollars to meet their end of month obligations." The bank also said high overnight and one-week borrowing rates were expected to keep local currency liquidity tight and spur a surge against the dollar.

Source