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Tanzania’s apex bank raises interest rate to check ‘lingering inflationary pressures’

Published

8 months ago

April 4, 2024

Tanzania’s central bank raised its benchmark interest rate on Thursday to fend off persistent inflationary pressure from events in the global economy, according to the governor of the institution.

The bank increased its key rate from 5.5% to 6.0% following its announcement earlier in the month that it would begin using a benchmark interest rate to signify the direction of its monetary policy.

The Bank of Tanzania announced a rate of 5.5% in January.

Governor Emmanuel Tutuba stated, “The decision… is based on the macroeconomic forecast made in March… which requires an increase in the scope of monetary policy actions to contain the lingering inflationary pressures,” during a meeting in Dar es Salaam with the heads of the nation’s banks.

After growing by almost 5% in 2023, Tanzania’s central bank predicted in February that the country’s GDP would expand by 5.5% in 2024. In the same month, the East African country recorded stable annual inflation of 3%, which remained below the government’s aim of no more than 5%.

“Growth is expected to be driven by public and private investment, reforms to improve business conditions, favourable weather, and a rebound in tourism,” the Bank of Tanzania projected.

“The stability was due to prudent monetary policy and adequate domestic food supply,” Tutuba said.

He claimed that the economy’s prognosis was bright and that it was expected to increase by roughly 5.1% in the first quarter of 2024. The economy is predicted to have grown by nearly 5% in 2023 from 4.7% a year earlier.

“The performance is underpinned by public investment, particularly in infrastructure, as part of the measures to facilitate private sector business and investment,” Tutuba said.

“Private sector investment also contributed to the estimated growth, because of the improving business environment in the country.”
Tanzania’s economy relies on among others, tourism, mining and agriculture.

Related Topics:Featured inflation Interest rate Tanzania

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Food prices drive second straight monthly hike in Nigeria’s inflation

Published

1 minute ago

November 17, 2024

Ifeoluwa Dada

According to official statistics released on Friday, Nigeria’s inflation rate increased for the second consecutive month in October, rising to 33.88% in annual terms from 32.70% in September, mostly as a result of increasing food costs.

In an attempt to boost economic development and strengthen public finances, President Bola Tinubu devalued the naira and reduced subsidies, which caused inflation to spike in the second half of last year.

As the effects of the naira devaluation started to lessen in July of this year, a slew of hikes in the price of petroleum and devastating floods that destroyed crops once again exacerbated pricing pressures, making the greatest cost-of-living crisis in decades worse in Africa’s most populous country.

According to the National Bureau of Statistics, price increases for basics such as rice, maize, bread, potatoes, and cooking oil prompted food inflation to surge from 37.77% in October to 39.16% year over year.

This year, more than 1.5 million hectares of agriculture have been damaged by torrential rain and floods in 29 of Nigeria’s 36 states, leaving millions hungry and displacing large numbers of people.

In an effort to curb inflation, the central bank has raised interest rates five times this year. On November 26, it is expected to make its final rate decision of the year.

VenturesNow

MTN financial report reveals drop in group service revenue

Published

9 minutes ago

November 17, 2024

Ifeoluwa Dada

Due to operational difficulties in Sudan and the depreciation of the Nigerian naira, MTN Group, Africa’s largest telecom provider, announced on Thursday an 18.5% decline in service revenue for the third quarter that concluded on September 30.

With 288 million users in 17 African regions, MTN said that its group service revenue dropped from 156.3 billion rand ($6.99 billion) in the same quarter of the previous year to 127.4 billion rand.

Despite stating that “the naira was less volatile on a sequential basis in Q3 than in preceding quarters,” the business reported a 48.7% decline in MTN Nigeria’s income due to the currency’s depreciation.

Due to a stronger Ugandan shilling than the previous year, Uganda’s largest contributor, MTN South Africa (MTN SA), expanded by a meagre 3.3%.

Due to “subscriber registration regulations in Nigeria and a decline in users in Sudan, where the conflict has displaced millions of people,” the business reported that its subscriber base increased by 1.6% to 288 million.

Given the higher demand in Nigeria despite the legal obstacles, MTN plans to increase its capital expenditures, which it expects would total between 28 and 33 billion rand for the entire year.