The Bank of Tanzania increased its repurchase agreement (repo) interest rate, placing the weighted average rate into double digits, with the rate last printing at 11.59% at the 25th of October auction (which compares to 8.24% at the start of the year, and a low of 0.93%). Tanzania reported inflation of 16.8% in September, compared to 10.9% in June.
Inflation has been driven upwards by food supply variation, electricity shortages, and a weak shilling. The Tanzanian economy has grown between 6 and 7.4 percent over the past 6 years in real terms, and grew 7% in 2010. The Tanzanian shilling (TZS) last traded around 1,768 against the US dollar, with the TZS weakening about 17% since March this year.
