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| 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
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