Interbank market remains stable

BoT HQ in Dar
Interbank market remains well funded irrespective of the 75bn/- outflow to fund the five-year bond issue, with liquidity situation expected to improve further in this week.

Standard Chartered Bank said, “We expect the liquidity situation to prevail next week with likely further decline on overnight rates.”

The weekly commentary issued by a brokerage firm Tanzania Securities indicates that interbank money market continued with a downward trend which has been the case for the past few weeks.

The market becomes more actives as “Institutional investors continue to slowly take advantage of improving liquidity.”  

 Last week the overnight rates dropped to a four-month low, sending positive signals of easing measures by the central bank to tighten money in circulation and reverse double digit inflation and shilling freefall.

According to data by the Bank of Tanzania, this is the first time the overnight rates have registered low interest rates since February this year. 

Financial analysts say that the drop is a good sign that lending rates would also go down and finally ease liquidity tightness.

Tanzania Securities Chief Executive Officer Moremi Marwa said, “The rates are going down at the moment with banks possessing enough money reserves.”

In April this year, the overnight rate hit a record high of 35.45 per cent, the highest level since the liberalization of the financial market in the early 1990s.
Source: The Daily News,http://dailynews.co.tz , reported by Abduel Elinaza
Share on Google Plus

About Abduel Elinaza

This is a short description in the author block about the author. You edit it by entering text in the "Biographical Info" field in the user admin panel.