Tanzania: Shilling Gains 13 Pips in Agri-Inflows

THE Tanzanian shilling has begun regaining strength after a marginal 13 percentage in

points (pips) appreciation for two consecutive weeks, thanks to agricultural inflows.

The shilling weighted average exchange rate at the end of the last week stood at 2,308/84 against the US dollar.

Orbit Securities said in its weekly market synopsis that the shilling held its position for two weeks straight at around 2,308/- against the US dollar.

"The shilling has regained strength after marginal 13 pips appreciation for two consecutive weeks," Orbit said.

The stockbrokerage firm said further the Interbank Foreign Exchange Market (IFEM) saw 18.7per cent less weekly value of transactions during the week ending last Friday.

The total amount traded on the IFEM amounted to $8.2m compared to $10.09m the previous week.

"The trend is similar to the first half of the year, where the total IFEM transactional value in the first half of this year is 24 per cent less compared to a similar period last year."

NMB Bank e-market report of last Thursday said the local market continued trading steadily with significant demand observed from retailers, manufacturers, oil marketing companies (OMCs) and other key importers.

"We anticipate the US dollar supply from the agri-sector and NGOs to ease the current demand in the market," the NMB report said.

Reports from Kenya showed that the shilling shed 0.5 per cent on the increase of the US dollar demand.

Last week, the Kenyan shilling depreciated by 0.5 per cent against the US dollar to close the week at 107/50 from 106/90, recorded the previous week.

The slight depreciation was attributable to increased US dollar demand from importers as global economies continued easing movement restrictions.

According to reports, the Kenyan shilling will continue getting pressure from the demand from merchandise and energy sector importers as they beef up their hard currency positions amidst a slowdown in US dollar.