The shilling has remained firm against the greenback, thanks to corporate month-end tax obligations and revenue inflows from agricultural exports.
According to Bank of Tanzania (BoT), the shilling has traded between 1560/- and 1585/- against the US dollar for almost a month.
The central bank data indicates that the local currency opened the month of July trading at 1,577/- and closed at 1,582/- a greenback while fluctuating around five shilling.
Standard Chartered Bank said they expected the trend to continue over the course of yesterday, which was the last day of the month. “Low level of volatility is also expected,” the banks said in its daily market report, pinning their projections on the back of good exports from traditional crops.
BoT monthly economic review of May shows that value of export of goods and services was 7.02billion US dollars compared to 6.24billion US dollars during the year ending last April. “The improvement was largely on account of increases in gold exports and travel receipts,” BoT report said.
However, National Microfinance Bank (NMB) said the shilling on Monday weakened slightly on the back of the resurgent greenback demand from oil, telecom, and manufacturing companies ahead of the new month. Meanwhile, interbank liquidity remains steady with banks funding requirement well met with offers.
According to the Standard Chartered Bank, the rates remains low across market where highest overnight offer was reported at five per cent while the lowest offer was recorded at 0.5 per cent resulting to weighted average rate at 3.69 per cent. Due to high interbank liquidity and relative cheap overnight funding the 110bn/- Treasury Bill that goes on auction today is expected to be well received.
“We expect the issue to be well attended especially with the current high interbank liquidity and cheap O/N funding,” the bank said.
By ABDUEL ELINAZA, Tanzania Daily News