BoT last changed the rate in April from 5.5 per cent.
The Monetary Policy Committee (MPC) of the Bank of Tanzania (BoT) has kept its benchmark interest rate unchanged at six per cent for the fourth quarter of the trading period in a bid to boost consumer and business spending and sustain the economic recovery momentum.
BoT last changed the rate in April from 5.5 per cent.
Governor Emmanuel Rutuba, who chaired the MPC, cited low inflation “below the target of five percent” for the decision. He said inflation was expected to remain steady and lead to a decline in commodity prices.
He forecast moderate pressure on the exchange rate due to increased forex inflows from various sources of revenues such as tourism and mining.
The agriculture, transport and manufacturing sectors have facilitated private sector activity, supported by public investment, particularly in infrastructure.
The outlook is positive, driven by expected favourable weather conditions for agriculture and power generation and improvements in infrastructure, particularly railways, roads and ports.
BoT’s projections show that there is no risk of banks pulling back from lending to the private sector in favour of buying government securities.
Tanzania has the lowest lending rate in the East African Community. The Central Bank of Kenya lowered its benchmark interest rate to 12.75 per cent at its meeting on August 6, whereas in Burundi it is 12 per cent. Uganda’s stands at 10 per cent, while Rwanda has revised it to 6.5 per cent.