Cost of credit picks up, inflation tamed at single digit

Measures implemented by the Bank of Tanzania (BoT) to reduce inflation rate has resulted into the rise of the cost of credit, the burden that was passed to the borrowers and negatively impacting on the expansion of the real economy.

“However, the magnitude of the negative impact may not be dramatic as the ratio of the total credit to Gross Domestic Product (GDP) was only 24.8 per cent last year compared to 130 per cent in emerging countries like Thailand and Malaysia,” the World Bank Tanzania Economic Update Report released last week has revealed.

The government, the WB report portrays, has successfully controlled inflation rate over the past two years through the implementation of a prudent monetary policy.

The National Bureau of Statistics (NBS) report shows that the annual headline inflation rate for November has slightly dropped to 6.2 per cent from 6.3 per cent of the previous month and double digits last year.

Source: Daily News, reported from Dar es Salaam, Tanzania

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