Shilling slides 2% on week-one of this year

The shilling has depreciated by 1.6 per cent in the last fifteen days since the year began as demand for US dollars grow at decreasing rate.

The shilling, according to Bank of Tanzania, opened the year at 1,586/- a greenback but fell to 1,612 of Friday last week losing its tempo exhibited at the close of last year.

The appreciation tempo displayed during the closing of the year came to a halt last Friday when it registered a two-month low level since last November.

The commercial banks quoted the shilling closing the week at 1,612/1,637 a dollar. Money market analysts predicted the trend to continue with low to medium market volatility.

Standard Chartered Bank said demand for the dollar continued to grow at the opening of the year though prospects for gaining are positive.

“Demand for the dollar continued to grow but at a decreased rate,” StanChart said in its daily market report of last Friday when the interbank foreign exchange market was closed.

The bank continued: “We anticipate the trend to continue with low to medium market volatility…” The National Microfinance Bank said the shilling tumbled following the increase of greenback in the market to close at 1,612/1,637 on Friday.

“With the increasing dollar demand in the market, the shilling tumbled further against the dollar,” NMB said in its e-Market newsletter.

The Chinese’s Renminbi, which is tipped to be the next major trading currency, closed the market steadily at 271/-, the same level in the last two months.

According to the Tanzania Securities, a stockbrokerage firm, the shilling fluctuated by less than one per cent with other major currencies — such as Euro, Great Britain pound and Kenyan shilling.

The shilling went down slightly by 0.72 per cent to 2,637/- against UK pound, by 0.04 per cent to 2,192/- a Euro and by 0.43 per cent to 18/50 of Kenyan shilling.
Source: Daily News, reported by Abduel Elinaza from Dar es Salaam, Tanzania
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