MWE Correspondent
The Monetary Policy Committee (MPC) has decided to maintain Tanzania’s Central Bank Rate (CBR) at 5.75 percent, reflecting growing confidence in the nation’s economic performance and political stability.
The move signals that policymakers are satisfied with the current pace of growth and inflation control.
According to Governor Emmanuel Tutuba, the decision mirrors positive developments both domestically and internationally. “Inflation remains stable, growth across key sectors is resilient, and global conditions continue to support our economy,” he said during a briefing after the committee’s meeting.
Tutuba noted that inflation projections remain within the target range of 3 to 5 percent — a sign that price pressures are under control while economic activities continue to expand steadily.
Recent data from the Bank of Tanzania confirm that the country’s economy is performing strongly. Mainland Tanzania’s GDP grew by 5.4 percent in the first quarter of 2025, compared to 5.2 percent during the same period in 2024. Meanwhile, Zanzibar posted an even higher growth rate of 6.4 percent, largely driven by mining, agriculture, manufacturing, and financial services.
Economic analysts predict that the upward momentum will continue throughout the year, with growth expected to surpass 6 percent in both the second and third quarters. The last quarter is also likely to maintain this pace, supported by infrastructure projects, a stable currency, and expanding business confidence.
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The decision to hold the rate steady has been widely interpreted as a vote of confidence in Tanzania’s macroeconomic stability. By maintaining the current rate, the central bank is providing a predictable environment for investors, businesses, and consumers alike.
“This is a sign of economic maturity,” said a Dar es Salaam-based economist. “It shows that the central bank is confident enough in the fundamentals to avoid unnecessary adjustments.”
The bank will also continue guiding the interbank lending rate to align closely with the CBR, ensuring liquidity and stability in the financial system.
While the outlook remains positive, experts caution that potential risks could arise from global economic shifts. Rising fuel and food prices could increase inflationary pressures, while global interest rate changes might affect capital inflows to developing economies.
Nonetheless, strong domestic performance — supported by steady exports, fiscal discipline, and improving investor sentiment — provides a cushion against these risks.
The Monetary Policy stance remains focused on sustaining growth while maintaining stability. By holding the benchmark rate, the central bank aims to foster an environment that encourages private sector investment, job creation, and financial inclusion.
