The prediction is based on the fact that the overnight rate, interbank, fell further to 5.5 per cent at the end of last week from 8.38 per cent of previous week.
The rate which last week hit the highest level in six weeks started easing last Monday. The Tanzania Securities Business Analyst Brenda Rose Massay said the fall of overnight rate indicates improved liquidity among commercial banks.
“With that, we anticipate positive results on the Treasury Bill auction to be conducted next week,” Ms Massay said in Dar es Salaam over the weekend.
The T-bill auction has recently been appreciating following the dropping of the inflation rate to 6.7 per cent in August being the two and half years low.
Bank of Tanzania said on its latest monthly report that the money supply gradually increases signifying the economy is moving in the right direction.
Bank of Tanzania said on its latest monthly report that the money supply gradually increases signifying the economy is moving in the right direction.
The economy moves in right direction since money supply increases when inflation is declining resulting into a robust growth.
The central bank says the annual growth of extended broad money supply (M3) was 17.6 per cent in July 2013 up from 15.6 per cent recorded in June 2013 and 12.8 per cent recorded in the corresponding period in 2012.
During the period under review, there was a significant increase in net credit to the government by the banking system to the tune of 1,240.5bn/- in the year ending July 2013, compared to a repayment of 22.9bn/- recorded in the corresponding period in 2012.
The central bank says the annual growth of extended broad money supply (M3) was 17.6 per cent in July 2013 up from 15.6 per cent recorded in June 2013 and 12.8 per cent recorded in the corresponding period in 2012.
During the period under review, there was a significant increase in net credit to the government by the banking system to the tune of 1,240.5bn/- in the year ending July 2013, compared to a repayment of 22.9bn/- recorded in the corresponding period in 2012.
Standard Chartered Bank said that the current range of overnight borrowing was the sign of improved money circulation.
“Overnight ranged between six and 10 per cent with liquidity conditions showing signs of improvement,” the bank said in its Daily market report.
“Overnight ranged between six and 10 per cent with liquidity conditions showing signs of improvement,” the bank said in its Daily market report.
However, National Microfinance Bank said overnight lending rates remained at 8.0 per cent, but cautioned that the liquidity may tighten on increased demand by corporate to meet monthly obligations. “
…Although(despite overnight rate easing) near to mediumterm demand for funds as we approach the quarter end indicates that liquidity may tighten and rates rise noticeably as we approach month end,” NMB said.
…Although(despite overnight rate easing) near to mediumterm demand for funds as we approach the quarter end indicates that liquidity may tighten and rates rise noticeably as we approach month end,” NMB said.
Source: Daily News, reported by Abduel Elinaza, from Dar es Salaam, Tanzania
0 comments :
Post a Comment