Emmanuel Tutuba, the governor of the Bank of Tanzania, announced the increased policy rate at a meeting with chief executive officers of banking institutions and mobile money service providers in the port city of Dar es Salaam.
Tutuba said that the decision to raise the policy rate was based on the macroeconomic forecast made in March 2024, which called for an expansion of monetary policy actions to address persistent inflationary pressures stemming from global economic developments.
The new central bank rate will be effective in the second quarter of 2024, spanning from April to June.
In January, the bank officially launched an interest rate-based monetary policy framework and set the policy rate at 5.5 percent for the first quarter of 2024.
During the launch, Tutuba explained that the central bank rate aimed to control inflation within the medium-term target of 5 percent, support economic growth to reach 5.5 percent or more in 2024, and maintain exchange rate stability.
He expressed confidence that the policy rate would guide financial institutions in their activities, including setting interest rates, thereby enhancing the transmission of monetary policy.
Latest comments