The Bank of Tanzania (BOT) released its Monthly Economic Review for July 2026, covering the year ending June 2026, showing exports of goods and services grew 17.2% to USD 19,923.6 million on strong earnings from gold, manufactured goods and tourism.
Headline inflation eased to 4.0% in June 2026, remaining within the national target range of 3 to 5%.
Credit to the private sector expanded 28.1%, with trade lending up 59.5%.
Foreign exchange reserves stood at USD 5,673.5 million, covering 4.4 months of projected imports.
The Central Bank Rate (CBR) was held at 5.75%, and the Tanzanian Shilling depreciated 0.08% year-on-year.
Inflation Eases to 4.0%
Headline annual inflation eased to 4.0% in June 2026, from 4.2% in May 2026, but was higher than the 3.3% recorded in June 2025.
The rate remained within the national target and the East African Community (EAC) and Southern African Development Community (SADC) convergence benchmarks.
Core inflation, which excludes unprocessed food and energy, rose to 3.7% from 3.4% the previous month and 1.9% a year earlier, driven by transport, personal care and social protection services.
Core inflation contributed 2.7 percentage points to headline inflation, the highest share in two years.
Annual food inflation slowed to 4.1% from 5.6% in May 2026 and 7.3% a year earlier, as the ongoing harvest improved availability of maize, rice and beans.
Energy, fuel and utilities inflation climbed to 6.3% from 5.0% the previous month and 2.1% in June 2025, on persistently high retail pump prices.
Transport inflation reached 13.6%, up from 11.9% the previous month.
National Food Reserve Agency (NFRA) stocks stood at 480,219 tonnes in June 2026, after the release of 16,812.3 tonnes of maize and paddy to traders.
Monetary Policy: CBR Held at 5.75%
The Monetary Policy Committee (MPC) kept the Central Bank Rate (CBR) at 5.75% for the quarter ending June 2026.
The MPC narrowed the interest rate corridor to 150 basis points on either side of the policy rate, equivalent to a band of 4.25 to 7.25%, to strengthen monetary policy transmission.
The 7-day interbank cash market rate averaged 5.98%, close to the CBR.
Extended broad money (M3) grew 25.5% in the year to June 2026, slightly above the 25.2% recorded in May 2026.
Private sector credit growth accelerated to 28.1% from 23.2%, reflecting increased lending for private investment and agricultural activity during the harvest season.
Trade posted the strongest annual credit growth at 59.5%, followed by transport and communication at 46.4% and agriculture at 39.9%.
Personal loans, which largely support micro, small and medium-sized enterprises, continued to account for the largest share of the outstanding credit portfolio.
Interest Rates Broadly Stable
The overall lending rate eased to 15.20% in June 2026, from 15.32% in May 2026.
The negotiated lending rate for prime customers increased slightly to 11.93% from 11.90%.
The overall time deposit rate rose to 8.60% from 8.43%, while the negotiated deposit rate declined to 11.17% from 11.25%.
The spread between one-year lending and deposit rates widened to 5.66 percentage points from 5.22 percentage points.
Financial Markets
Government Securities
The Bank conducted two Treasury bill auctions with a combined tender size of TZS 552.1 billion.
Bids reached TZS 1,295.9 billion, of which TZS 597.1 billion was accepted.
The overall weighted average yield on Treasury bills edged up to 4.83% from 4.74%.
The 10-year and 25-year Treasury bonds carried a combined tender size of TZS 387.6 billion, attracting bids of TZS 1,539.6 billion, of which TZS 269.8 billion was accepted.
The 10-year yield rose 0.99 percentage points to 10.39% from 9.40%, while the 25-year yield moderated to 11.89% from 11.99%.
Interbank Cash Market
Interbank cash market turnover rose to TZS 2,508.7 billion in June 2026, from TZS 1,732.7 billion in May 2026.
The 7-day tenor accounted for 56.8% of volume.
The overall interbank rate eased to 6.0% from 6.14%.
Interbank Foreign Exchange Market
Turnover in the interbank foreign exchange market rose to USD 193.3 million, from USD 119.3 million in May 2026.
The Bank made a net sale of USD 28.5 million to smooth exchange rate volatility.
The Shilling traded at an average of TZS 2,633.73 per USD, compared with TZS 2,616.88 in May 2026, depreciating 0.08% year-on-year.
Government Budgetary Operations
Total government revenue amounted to TZS 3,259.4 billion in May 2026, 0.5% above the monthly target.
Central government revenue reached TZS 3,152.4 billion, representing 96.7% of the total and exceeding its target by 1.4%.
Tax revenue was TZS 2,749.96 billion, 5.2% above target, driven by income tax collections that exceeded their monthly target by 32.9%.
Non-tax revenue stood at TZS 402.5 billion, short of the target of TZS 494.7 billion.
Total expenditure was TZS 4,018.4 billion, comprising TZS 2,880.7 billion in recurrent spending and TZS 1,137.7 billion in development spending.
Debt Developments
The national debt stock stood at USD 50,595.8 million at end-June 2026, with external debt accounting for 70.4%.
External Debt
External debt stock (public and private) rose 0.1% to USD 35,606.1 million, of which 83.1% was public.
External loan disbursements during the month totalled USD 379.8 million, mainly to the central government.
External debt service payments were USD 249.2 million, including USD 184.9 million in principal repayments.
Multilateral institutions remained the largest creditor category at 59.3%, followed by commercial lenders.
The US Dollar dominated the currency composition at 66.2%, followed by the Euro at 17.4%.
Domestic Debt
Domestic debt rose marginally to TZS 39,325.85 billion at end-June 2026, with the overdraft facility constituting the largest portion.
The Government mobilised TZS 468 billion through securities, comprising TZS 273.3 billion in Treasury bonds and TZS 194.7 billion in Treasury bills.
Domestic debt service payments totalled TZS 1,551.5 billion, including TZS 1,264.4 billion in principal and TZS 287.1 billion in interest.
External Sector Performance
Current Account
The current account deficit widened 7.0% to USD 2,303.9 million in the year ending June 2026, from USD 2,153.4 million a year earlier.
The widening reflected imports expanding at a faster pace than export earnings.
Exports
Exports of goods and services grew 17.2% to USD 19,923.6 million in the year ending June 2026, from USD 17,001.3 million a year earlier.
Goods exports rose 19.2% to USD 11,782.7 million, from USD 9,885.9 million.
Gold exports increased by 36.3% to USD 5,522.9 million, from USD 4,049.1 million, benefiting from elevated international prices.
Manufactured goods exports rose by 46.3% to USD 2,162.2 million, from USD 1,477.8 million, driven by iron and steel, glassware, and textiles.
Among traditional exports, tobacco increased to USD 604.9 million from USD 470.3 million, while coffee grew to USD 399.4 million from USD 341.6 million.
Service receipts grew 14.4% to USD 8,140.9 million, from USD 7,115.4 million.
Travel receipts, the largest component, reached USD 4,405.5 million, reflecting a 4.5% rise in international tourist arrivals to 2,291,479.
Transport receipts firmed to USD 3,230.9 million, from USD 2,538.3 million, on higher transit cargo volumes.
Imports
Imports of goods and services increased 18.1% to USD 20,815.7 million, from USD 17,629.8 million.
Goods imports rose 20.6% to USD 17,440.4 million, led by industrial supplies, petroleum products and capital goods.
Imports of refined white petroleum products, about 16.2% of total goods imports, rose 19.5% to USD 2,826.9 million.
Service payments increased 6.7% to USD 3,375.3 million, on higher freight costs.
The primary income account deficit narrowed to USD 1,773.2 million, from USD 2,011.4 million.
The secondary income surplus fell to USD 361.4 million, from USD 486.6 million, on lower personal transfers.
Foreign Exchange Reserves
Foreign exchange reserves stood at USD 5,673.5 million at end-June 2026, covering 4.4 months of projected imports and exceeding the national benchmark of four months.
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