This page is prepared by TICGL/TERI for research and information purposes. It is not investment, legal, tax or financial advice and does not state the position of the Bank of Tanzania or the Government of Tanzania. All macro figures are taken from the Bank of Tanzania's September 2026 Monthly Economic Review (August 2026 data; recent figures are provisional). Derived ratios (real rates, shares, percentage changes) are TICGL/TERI computations from the cited BoT tables and are not forecasts. Where two BoT tables differ slightly (for example goods imports of USD 17,770.9m in Table 2.7.1 versus USD 17,771.7m in Table A7), this page uses the table cited next to the figure.
00 — OverviewExecutive Summary
Tanzania's August 2026 macro picture is one of strong nominal momentum with a tightening policy backdrop and a more expensive external bill. The Bank of Tanzania raised the Central Bank Rate to 6.25% in July to contain second-round effects from higher energy, fertiliser and transport costs linked to the Middle East conflict. Headline inflation is still inside the 3–5% target band at 4.3%, but its composition has changed: core inflation (4.1%) now contributes 3.1 of the 4.3 percentage points, against 1.5 of 3.4 a year ago, while unprocessed food has faded from 1.8 to 0.8 points. Private-sector credit is growing at 33.0% — led by transport and communication (77.2%) and mining (75.9%) — extended broad money (M3) is up 25.5%, and the shilling has weakened 6.7% year on year. Abroad, exports of goods and services rose 16.4% to USD 20,216.2 million, but imports rose faster (21.4%), and the current-account deficit widened to USD 2,481.8 million, with petroleum imports up 51.7%.
Taken together, the data describe an economy whose nominal momentum is intact but whose external bill and cost of money are rising: policy is tighter, credit is expanding fast in a few sectors, the shilling is softer, and the external deficit is widening even as exports reach a record.
Headline numbers look benign (inflation inside target, revenue above target, reserves above benchmark), but the composition underneath has shifted: inflation is now core-driven rather than food-driven, the policy rate has gone up, lending rates sit at 15.05% overall, government yields reach 11.48% at the 25-year point, imports are growing faster than exports, and domestic debt has reached TZS 40.9 trillion. Those are the variables to watch over the next quarter.
Read this alongside TICGL/TERI's investment-climate analysis
The macro conditions on this page are one half of the picture. The other half — the opportunities and risks that shape the investment climate in Tanzania in 2026 — is set out in TICGL/TERI's investment-climate assessment.
Read: Opportunities & Risks in Tanzania, 2026 → Invest in Tanzania →A1 — Macro DashboardTanzania's Macro Variables at a Glance, August 2026
The table below puts the main macro variables in one view, with the prior-year comparison and the direction of travel.
| Variable | Aug-25 (or prior year) | Jul-26 | Aug-26 | Why it matters to an investor |
|---|---|---|---|---|
| Headline inflation (y/y) | 3.4% | 4.2% | 4.3% | Inside the 3–5% target; sets the nominal-to-real bridge in any model |
| Core inflation (y/y) | 2.0% | 3.9% | 4.1% | Underlying pressure; rising steadily since March 2026 |
| Food inflation (y/y) | 7.7% | 4.1% | 3.7% | Eased on staple supply; El Niño is the upside risk |
| Energy, fuel & utilities (y/y) | 2.6% | 6.9% | 8.5% | Highest since Oct-24; charcoal and firewood driven |
| Central Bank Rate | 5.30% (Repo rate) | 6.25% | 6.25% | Less accommodative stance; corridor 4.75%–7.75% |
| Overall lending rate | 15.07% | 15.10% | 15.05% | Anchor for TZS cost of debt |
| Negotiated (prime) lending rate | 12.72% | 12.04% | 11.93% | Rate negotiated by strong corporate borrowers |
| 12-month deposit rate | 9.99% | 9.34% | 9.36% | Opportunity cost of local equity |
| Overall Treasury bill yield | 6.83% | 4.74% | 4.86% | Short-end risk-free reference |
| 25-year Treasury bond yield | 14.42% | 11.89% | 11.48% | Long-end benchmark for government borrowing |
| Private-sector credit growth (y/y) | 16.2% | 31.2% | 33.0% | Financing availability — and a credit-quality watch item |
| Extended broad money (M3), y/y | 20.5% | 26.9% | 25.5% | Moderating with tighter stance |
| TZS per USD (monthly average) | 2,490.16 (Aug-25) | 2,653.52 | 2,657.01 | Shilling −6.7% y/y; drives USD-denominated cost and debt |
| Gross official reserves | USD 6,329.0M (Dec-25) | — | USD 5,888.2M | 4.2 months of projected imports; above benchmark |
| Current-account balance (12 mo.) | −USD 1,700.9M | — | −USD 2,481.8M | Widening external gap; FX pressure risk |
| Exports of goods & services (12 mo.) | USD 17,371.1M | — | USD 20,216.2M | +16.4%; gold USD 5,625.0M |
| Imports of goods & services (12 mo.) | USD 17,517.7M | — | USD 21,269.2M | +21.4%; petroleum +51.7% |
| Total national debt | USD 49,086.4M | USD 51,350.8M | USD 52,224.4M | +1.7% m/m; external 70.3% |
| External debt arrears | USD 578.9M | USD 984.7M | USD 1,040.0M | Rising; commercial arrears USD 417.8M |
| Domestic debt stock | TZS 37,309.8bn | TZS 39,472.2bn | TZS 40,899.5bn | +3.6% m/m on bond issuance |
| Government revenue, Jun-26 | — | — | TZS 4,658.2bn | +5.4% vs monthly target |
| Zanzibar headline inflation | 3.9% | 6.0% | 5.6% | Food-driven; fuel-linked transport costs |
| Zanzibar current account (12 mo.) | +USD 799.3M | — | +USD 953.7M | Tourism-led surplus |
| World GDP growth 2026 (IMF) | — | — | 3.0% | Resilient, but Hormuz disruption raises energy and fertiliser costs |
Sources: BoT MER Sept 2026 — Tables 2.1.1, 2.2.1, 2.3.1, A3, A4, A8, A9, A10; Sections 2.5–2.7, 3.1–3.3. Repo rate for Aug-25 from Table A4; Dec-25 reserves from Table A1 (2025p). Real lending rate is a TICGL/TERI computation.
Longer-run context: 2018–2025
Before the 2026 moves, Tanzania's real GDP growth had recovered from 3.6% in 2020 to 5.9% in 2025, inflation had stayed in a 3.1%–4.3% band, private-sector credit had deepened from 13.8% to 19.1% of GDP, and the current-account deficit had narrowed from a peak of USD 5,482.2 million (2022) to USD 2,049.4 million (2025). The August 2026 data therefore describe a widening from a stronger base, not a collapse.
Real GDP Growth and Inflation, 2018–2025
Private-Sector Credit to GDP, 2018–2025
A2 — Prices & InflationInflation Has Changed Character: From Food-Driven to Core-Driven
Headline inflation rose to 4.3% in August 2026 from 4.2% in July and 3.4% a year earlier — still inside the national 3–5% target and the EAC (8%) and SADC convergence benchmarks. The uptick reflected lagged pass-through of earlier fuel-price increases to bus, taxi and motorcycle-taxi fares. Month on month, prices rose 0.1%, after −0.1% in July.
The more important story for any investor is composition. Core inflation, which excludes unprocessed food, energy and utilities, rose to 4.1% (2.0% a year ago) and has climbed every month since March 2026. Services inflation is at 5.9% (0.8% a year ago). Transport inflation has been flat at 13.8% for two months after jumping from 4.2% in March to 9.2% in April and 13.6% in June. Food inflation, by contrast, eased to 3.7% from 7.7%, as maize, rice and beans were cheaper than a year earlier.
Twelve-Month Inflation: Headline, Core, Food and Energy
Contribution to Headline Inflation
Underlying Pressures: Core, Services and Goods
Inflation by main group, August 2026
| Group | CPI weight (%) | Aug-25 | Jul-26 | Aug-26 | Change vs Aug-25 (pp) |
|---|---|---|---|---|---|
| Food & non-alcoholic beverages | 28.2 | 7.7 | 4.1 | 3.7 | −4.0 |
| Transport | 14.1 | 1.4 | 13.8 | 13.8 | +12.4 |
| Housing, water, electricity, gas & fuels | 15.1 | 2.1 | 1.6 | 2.5 | +0.4 |
| Clothing & footwear | 10.8 | 1.7 | 1.6 | 1.8 | +0.1 |
| Furnishings & household maintenance | 7.9 | 2.4 | 2.2 | 2.6 | +0.2 |
| Restaurants & accommodation | 6.6 | 0.9 | 2.7 | 3.0 | +2.1 |
| Information & communication | 5.4 | 0.4 | 0.6 | 1.5 | +1.1 |
| Health | 2.5 | 1.3 | 1.4 | 1.5 | +0.2 |
| Education services | 2.0 | 3.0 | 2.8 | 3.2 | +0.2 |
| Insurance & financial services | 2.1 | 0.6 | 0.2 | 0.2 | −0.4 |
| Personal care & miscellaneous | 2.1 | 2.3 | 3.4 | 3.3 | +1.0 |
| Recreation, sport & culture | 1.6 | 1.4 | 0.7 | 0.7 | −0.7 |
| Alcoholic beverages & tobacco | 1.9 | 2.9 | 1.9 | 1.5 | −1.4 |
| Headline (all items) | 100.0 | 3.4 | 4.2 | 4.3 | +0.9 |
Source: BoT MER Sept 2026, Table 2.1.1. Core 4.1% (weight 73.9); non-core 4.8% (26.1); services 5.9% (37.2); goods 3.5% (62.8). "Change vs Aug-25" computed by TICGL/TERI.
Inflation is no longer food-led and volatile. Services inflation at 5.9% and transport at 13.8% matter most for logistics-heavy, labour-heavy and fuel-intensive activities; restaurants & accommodation (3.0%) and information & communication (1.5%, up from 0.4%) show pricing power returning in consumer services. Cost pressure is therefore uneven across fuel, wages, utilities and imported inputs, rather than uniform.
Food supply and fuel: the swing factors
- Food stocks: National Food Reserve Agency stocks were 484,332 tonnes at end-August 2026, against 537,571 tonnes a year earlier; the Agency bought 89.5 tonnes and released 2,813.7 tonnes of maize and paddy in the month.
- Domestic fuel: petrol and diesel prices in Dar es Salaam remained well below June 2026 levels, yet global refined-product prices (white products USD 1,167.21/tonne in August) point to upside risk for domestic energy inflation.
- El Niño: above-normal Vuli rainfall could disrupt transport and food distribution; drought in southern SADC may lift regional food demand — a relevant signal for agribusiness and export-crop projects.
A3 — Rates, Money & CreditThe Cost of Money: Higher Policy Rate, Falling Yields, Booming Credit
The Monetary Policy Committee's July 2026 decision lifted the Central Bank Rate to 6.25%; the Bank has since kept the 7-day interbank rate inside a 4.75%–7.75% corridor. The 7-day IBCM-based overall interbank rate averaged 6.67% in August (6.57% in July). Total IBCM turnover fell to TZS 4,566.2 billion from TZS 5,627 billion, with the 7-day segment at 47.8% of transactions. Reverse-repo use rose as a few banks covered temporary liquidity shortfalls.
The paradox investors should note: while the policy rate rose, government yields fell sharply year on year and credit accelerated. Treasury-bill auctions drew bids of TZS 981.7 billion against TZS 580 billion offered (bid-to-cover 1.7; TZS 520.8 billion accepted; weighted average yield 4.86%, up from 4.74%). Bond auctions (15- and 25-year, TZS 621.5 billion offered) drew TZS 2,136.3 billion — bid-to-cover 3.4 — and the 25-year yield fell to 11.48% from 11.89% at the previous auction.
Government Yield Curve: Aug-25 vs Aug-26
Overall Treasury Bill Yield, Aug-25 to Aug-26
Treasury yields by tenor
| Instrument | Aug-25 | Jun-26 | Jul-26 | Aug-26 | Change vs Aug-25 (pp) |
|---|---|---|---|---|---|
| 35-day T-bill | 6.50 | 2.82 | 2.34 | 2.11 | −4.39 |
| 91-day T-bill | 7.36 | 3.56 | 3.40 | 3.42 | −3.94 |
| 182-day T-bill | 7.46 | 4.98 | 4.74 | 5.12 | −2.34 |
| 364-day T-bill | 6.79 | 6.65 | 7.07 | 6.70 | −0.09 |
| 2-year bond | 12.17 | 8.36 | 8.40 | 8.40 | −3.77 |
| 5-year bond | 13.18 | 9.54 | 9.54 | 9.54 | −3.64 |
| 10-year bond | 13.74 | 10.39 | 10.87 | 10.87 | −2.87 |
| 15-year bond | 13.91 | 10.39 | 10.39 | 10.55 | −3.36 |
| 20-year bond | 14.50 | 10.43 | 11.33 | 11.33 | −3.17 |
| 25-year bond | 14.42 | 11.89 | 11.89 | 11.48 | −2.94 |
Source: BoT MER Sept 2026, Table A4 (Aug-26 provisional). Differences computed by TICGL/TERI.
Bank lending and deposit rates
Lending Rates, Deposit Rate and Spread, Jan–Aug 2026
| Rate | Jan-26 | Feb-26 | Mar-26 | Apr-26 | May-26 | Jun-26 | Jul-26 | Aug-26 |
|---|---|---|---|---|---|---|---|---|
| Savings deposit rate | 2.94 | 2.98 | 2.89 | 2.91 | 2.85 | 2.90 | 2.90 | 2.77 |
| Overall lending rate | 15.10 | 15.11 | 15.11 | 15.33 | 15.32 | 15.22 | 15.10 | 15.05 |
| Short-term lending (up to 1 yr) | 15.49 | 15.41 | 15.45 | 15.31 | 15.38 | 15.38 | 15.54 | 15.31 |
| Negotiated lending rate | 12.25 | 12.19 | 12.21 | 12.56 | 11.90 | 11.93 | 12.04 | 11.93 |
| Overall time deposit rate | 8.33 | 8.32 | 8.33 | 8.54 | 8.43 | 8.69 | 8.78 | 8.78 |
| 12-month deposit rate | 9.70 | 9.82 | 9.60 | 9.81 | 10.17 | 9.72 | 9.34 | 9.36 |
| Negotiated deposit rate | 11.74 | 11.48 | 11.57 | 11.37 | 11.25 | 11.17 | 10.99 | 11.06 |
| Short-term spread | 5.79 | 5.59 | 5.85 | 5.50 | 5.22 | 5.66 | 6.20 | 5.95 |
Source: BoT MER Sept 2026, Table 2.3.1. Foreign-currency lending (Table A4): overall lending rate 8.96%, up-to-1-year 10.03%, over-5-year term loans 8.96%; foreign-currency 12-month deposit rate 5.31%.
Money supply and private-sector credit
Extended broad money (M3) grew 25.5% in the year to August 2026 (26.9% in July), reaching TZS 72,121.0 billion; broad money (M2) grew 28.1% and reserve money (M0) 27.4%. Credit to the private sector grew 33.0% to TZS 55,229.9 billion, from TZS 41,530.9 billion a year earlier. Net foreign assets fell 13.9% to TZS 13,575.4 billion — the Bank of Tanzania's NFA down 1.5% and other depository corporations' NFA turning negative (−TZS 155.5 billion) — so the money-supply expansion is domestically driven, not reserve-driven.
Extended Broad Money (M3), Aug-25 to Aug-26
Credit to the Private Sector
Annual Credit Growth by Economic Activity: Aug-25 vs Aug-26
| Sector | Aug-25 | Jun-26 | Jul-26 | Aug-26 | Share of select credit, Aug-26 (%) |
|---|---|---|---|---|---|
| Transport & communication | 18.8 | 59.5 | 66.0 | 77.2 | 6.0 |
| Mining & quarrying | 3.2 | 39.9 | 65.2 | 75.9 | n/a |
| Trade | 29.2 | 46.4 | 43.5 | 47.1 | 15.8 |
| Building & construction | 14.8 | 34.4 | 38.9 | 41.8 | 4.8 |
| Agriculture | 30.1 | 30.1 | 37.3 | 38.4 | 13.8 |
| Personal | 15.0 | 21.8 | 24.7 | 24.9 | 34.1 |
| Hotels & restaurants | 11.4 | 0.9 | 25.1 | 24.6 | n/a |
| Manufacturing | 3.4 | 8.3 | 5.1 | 12.9 | 7.4 |
Source: BoT MER Sept 2026, Tables 2.2.2 and Chart 2.2.6 (shares are of the selected activities charted by BoT, which do not sum to 100%). Personal loans, mostly supporting MSMEs, remain the largest component at 34.1%.
Credit growth of 33% — with mining at 75.9% and transport and communication at 77.2% — widens financing options for borrowers, but it also concentrates credit in a few sectors and raises asset-quality questions. BoT expects the less accommodative stance to moderate credit expansion gradually.
A4 — Fiscal Operations & DebtRevenue Is Beating Targets; Debt Is Rising Faster Than the Headline Suggests
In June 2026 total government revenue reached TZS 4,658.2 billion, 5.4% above target; the central government collected TZS 4,512.1 billion (96.9%). Tax revenue of TZS 3,733.2 billion was 12.5% above target, supported by tax-administration improvements, while non-tax revenue of TZS 778.9 billion fell short of a TZS 953.8 billion target. Spending of TZS 4,720.1 billion was below the TZS 4,979.8 billion estimate, split between TZS 2,797.9 billion recurrent and TZS 1,922.2 billion development.
June 2026 Revenue and Grants: Actual vs Estimate
June 2026 Expenditure: Actual vs Estimate
June 2026 outturn versus estimate, and financial-year totals
| TZS billion | Jun-26 estimate | Jun-26 actual | Variance | FY2025/26 budget | FY actual (Jul-25 to Jun-26) |
|---|---|---|---|---|---|
| Total revenue (incl. LGAs) | 4,419.7 | 4,658.2 | +5.4% | 40,466.1 | 41,930.4 |
| Tax revenue | 3,319.8 | 3,733.2 | +12.5% | 32,176.0 | 34,579.2 |
| — Taxes on imports | 995.6 | 1,213.3 | +21.9% | 11,563.0 | 12,559.2 |
| — Sales/VAT & excise (local) | 684.6 | 587.5 | −14.2% | 7,016.5 | 6,492.3 |
| — Income taxes | 1,436.4 | 1,702.9 | +18.6% | 11,367.9 | 13,220.6 |
| Non-tax revenue | 953.8 | 778.9 | −18.3% | 4,681.7 | 5,744.5 |
| Total expenditure | 4,979.8 | 4,720.0 | −5.2% | 48,775.0 | 48,451.0 |
| — Wages & salaries | 1,119.8 | 1,163.1 | +3.9% | 10,917.5 | 13,279.3 |
| — Interest payments | 644.0 | 597.4 | −7.2% | 6,493.7 | 5,605.3 |
| — Development expenditure | 2,014.4 | 1,922.1 | −4.6% | 17,493.7 | 17,057.2 |
| Overall balance | −371.3 | −362.6 | — | −7,239.0 | −6,147.7 |
Source: BoT MER Sept 2026, Table A2 (Mainland, cheques issued; 2026 actuals provisional). Variances computed by TICGL/TERI. Interest payments in the financial year were TZS 5,605.3 billion — about 13.4% of total revenue (computed).
National debt: size, currency and creditor
The national debt stock rose 1.7% month on month to USD 52,224.4 million at end-August 2026 (about 6.4% above August 2025, computed). External debt — USD 36,731.5 million, 70.3% of the total — is 83.7% public and rose 0.8% in the month. Multilateral lenders hold 59.5% of external debt and commercial lenders 34.4%. The US dollar is 64.9% of disbursed external debt, the euro 18.4%, the Chinese yuan 6.7%. External disbursements were USD 160.1 million in August, mainly to the central government, while external debt service was USD 139.1 million (USD 69.2 million principal). External-debt arrears have climbed to USD 1,040.0 million from USD 578.9 million a year earlier.
Domestic debt rose 3.6% in the month to TZS 40,899.5 billion on Treasury-bond issuance: the Government raised TZS 632.5 billion in August (TZS 178.1 billion bills; TZS 454.4 billion bonds) against domestic debt service of TZS 633.4 billion (TZS 163.5 billion principal; TZS 469.9 billion interest). Commercial banks hold 28.4% and pension funds 27.6% of the stock.
Government Domestic Debt Stock
External Debt by Creditor, Aug-26
External Debt by Currency, Aug-26
External Debt by Use of Funds, Aug-26
Rising arrears, a deficit financed by domestic bonds and a 64.9% dollar share of external debt expose the budget to exchange-rate and refinancing risk, and banks and pension funds hold roughly 56% of domestic debt between them, which bears on how much room is left for private borrowers.
A5 — External Sector & Exchange RateExports Are Strong, but Imports Are Stronger: The Current-Account Deficit Is Widening
The external sector remained sustainable, but higher costs of petroleum products and intermediate inputs pushed import growth above export growth. In the year to August 2026 exports of goods and services rose 16.4% to USD 20,216.2 million, while imports rose 21.4% to USD 21,269.2 million, leaving the current-account deficit at USD 2,481.8 million (USD 1,700.9 million a year earlier). Gross official reserves were USD 5,888.2 million — 4.2 months of projected imports (excluding FDI-related imports), above the national benchmark.
| USD million (year ending August) | 2025 | 2026p | Change |
|---|---|---|---|
| Goods exports | 9,981.2 | 11,960.8 | +19.8% |
| Goods imports (f.o.b.) | 14,321.5 | 17,770.9 | +24.1% |
| Goods account balance | −4,340.3 | −5,810.2 | +33.9% wider |
| Services receipts | 7,389.8 | 8,255.4 | +11.7% |
| Services payments | 3,196.2 | 3,498.2 | +9.4% |
| Services account balance | 4,193.6 | 4,757.2 | +13.4% |
| Goods & services balance | −146.6 | −1,053.0 | 618% wider |
| Primary income balance | −2,026.5 | −1,870.2 | deficit −7.7% |
| Secondary income balance | 472.2 | 441.4 | −6.5% |
| Current-account balance | −1,700.9 | −2,481.8 | +45.9% wider |
Source: BoT MER Sept 2026, Table 2.7.1.
Select Exports of Goods and Services
Select Imports of Goods and Services
Exports: gold leads, manufactured goods surge, traditional crops mixed
Gold exports rose 30.2% to USD 5,625.0 million (47.0% of goods exports, computed) on higher prices and volumes and contributed nearly two-thirds of the increase in goods exports. Manufactured goods exports rose 44.3% to USD 2,213.4 million on iron and steel (USD 141.5 million) and glassware (USD 142.0 million). Traditional exports rose 12.8% to USD 1,594.3 million, with tobacco (USD 570.2 million), tea (USD 99.4 million) and cloves (USD 161.0 million) up, but cashew nuts down to USD 369.2 million from USD 527.6 million and coffee at USD 269.3 million. Cereals fell to USD 189.8 million from USD 355.5 million (maize and rice both lower), and oil seeds to USD 209.2 million from USD 282.6 million.
Services receipts rose 11.7% to USD 8,255.4 million — transport USD 3,303.3 million (+26.4%, transit-trade freight) and travel USD 4,389.7 million (+1.7%).
Services Receipts by Category
Imports: capital goods, intermediate goods and petroleum
Capital-goods imports rose 35.3% to USD 4,099.7 million (machinery USD 1,487.5 million, +33.1%; electrical machinery USD 764.8 million, +88.4%; industrial transport equipment USD 1,359.4 million). Intermediate imports rose 21.6% to USD 11,912.4 million, led by petroleum products (+51.7% to USD 3,425.6 million — about 34% of the increase in the goods import bill, computed) and industrial supplies (+11.7% to USD 5,718.2 million). Consumer-goods imports rose 17.7% to USD 1,757.4 million. Freight payments rose 29.5% to USD 1,683.4 million as shipping costs climbed.
A 35% rise in capital-goods imports and a 29.5% rise in freight payments are signals that imported equipment and logistics cost more in dollars and in shillings. TICGL's technical and operational workstream therefore prices imported plant, spare parts and freight in USD with explicit contingency, tests local-sourcing alternatives, and links capex timing to the exchange-rate scenario rather than to a fixed rate.
The shilling and the Interbank Foreign Exchange Market
The shilling averaged TZS 2,657.01 per USD in August 2026 against TZS 2,653.52 in July, a 6.7% annual depreciation (versus a 0.5% appreciation in the preceding month's annual comparison); BoT notes the swing largely reflects a base effect, as the shilling had appreciated sharply in August 2025 to TZS 2,490.16. IFEM turnover was USD 190.3 million (USD 227.1 million in July), buoyed by gold and traditional commodity inflows and tourism, and the Bank sold a net USD 45.4 million to smooth volatility. On BoT's end-period series, the rate moved from TZS 2,463.3 (Aug-25) to TZS 2,639.9 (Aug-26): 7.2% depreciation (computed).
TZS per USD, End of Period
Current-Account Balance, 2018–2025 and Year to Aug-26
Gross Official Reserves, 2018–2025 and Aug-26
A6 — ZanzibarZanzibar: Higher Inflation, a Growing Current-Account Surplus and Tourism-Led Receipts
Zanzibar's headline inflation eased to 5.6% in August 2026 from 6.0% in July, but remained above the 3.9% of August 2025, driven by food (Mbeya rice, sugar, fish and cooking bananas) and fuel-linked transport costs. Food inflation was 9.8% (11.1% in July; 4.2% a year earlier) and non-food 2.2%. Month on month, consumer prices fell 0.2%.
Zanzibar Annual Inflation
Zanzibar Government Resources, August 2026
| Zanzibar indicator | Aug-25 / 2025 | Aug-26 / 2026p | Note |
|---|---|---|---|
| Government resources (revenue & grants), Aug | — | TZS 251.3bn | 10.4% above target; boosted by World Bank budget support |
| Domestic revenue, Aug | — | TZS 198.0bn | 92.7% of target; tax TZS 174.5bn (88.7% of target); non-tax TZS 23.6bn (+38.2% vs target) |
| Government expenditure, Aug | — | TZS 459.0bn | 73.3% for development projects |
| Current-account balance (12 mo.) | USD 799.3M | USD 953.7M | +19.3%; higher service receipts |
| Exports of goods & services (12 mo.) | USD 1,554.2M | USD 1,847.0M | +18.8%; tourism-related receipts |
| Goods exports (12 mo.) | USD 32.5M | USD 69.2M | Clove exports USD 42.5M (USD 3.6M a year earlier) |
| Imports of goods & services (12 mo.) | USD 648.0M | USD 909.5M | +40.4%; capital and intermediate goods |
| Services receipts (12 mo.) | USD 1,521.6M | USD 1,777.8M | +16.8% |
Source: BoT MER Sept 2026, Sections 3.1–3.3; Tables 3.1.1, 3.3.1–3.3.3. Zanzibar's services account (net USD 1,707.2 million) far exceeds its goods deficit (USD 769.8 million), which gives Zanzibar a very different external profile from the Mainland.
↑ Back to menuA7 — Global BackdropThe External Shock Behind the Domestic Numbers
Global growth is projected at 3.0% in 2026 (IMF WEO Update, July 2026), supported by resilient domestic demand and AI-related investment, but disruptions to shipping through the Strait of Hormuz have raised energy and fertiliser prices. In August 2026 crude oil averaged USD 84.4 per barrel (+5.8%; about 36% above the Q4 2025 pre-conflict average), European natural gas USD 21.11/mmbtu (+16.9%), and gold USD 4,411 per troy ounce (up from USD 4,073). Wheat (+6.5%), sugar (+11.8%) and palm oil (+1.5%) rose; Robusta (−2.2%) and urea (−2.5%) fell, while DAP rose 1.6%. US headline inflation held at 3.4%, euro-area inflation rose to 3.2% (energy inflation 14.3%), China's rose to 0.8% and India's to 4.8%. BoT flags prolonged Middle East conflict and a strengthening El Niño (late 2026 to early 2027) as the key downside risks.
Crude Oil (Average), Aug-25 to Aug-26
Gold and Urea Price Path
| Commodity | Unit | Jun-26 | Jul-26 | Aug-26 | m/m change |
|---|---|---|---|---|---|
| Crude oil, average | USD/barrel | 81.7 | 79.8 | 84.4 | +5.8% |
| Gold | USD/troy oz | 4,228 | 4,073 | 4,411 | +8.3% |
| Natural gas, Europe | USD/mmbtu | 15.17 | 18.06 | 21.11 | +16.9% |
| Wheat, US HRW | USD/tonne | 286.0 | 310.0 | 330.0 | +6.5% |
| Sugar, world | USD/kg | 0.32 | 0.34 | 0.38 | +11.8% |
| Coffee, Arabica | USD/kg | 6.79 | 7.91 | 7.97 | +0.8% |
| Coffee, Robusta | USD/kg | 3.73 | 4.07 | 3.98 | −2.2% |
| Palm oil | USD/tonne | 1,104.0 | 1,101.0 | 1,117.0 | +1.5% |
| DAP (fertiliser) | USD/tonne | 783.8 | 781.3 | 793.5 | +1.6% |
| Urea (fertiliser) | USD/tonne | 453.1 | 400.0 | 390.0 | −2.5% |
Source: BoT MER Sept 2026, Table 1.1 and Table A8 (World Bank Pink Sheet).
↑ Back to menuB1 — Risk WatchlistWhat Could Change These Numbers in the Next Quarter
The BoT's own outlook points to four risks that would change the numbers above.
1Prolonged Middle East conflict
- Oil at USD 84.4 is 36% above its pre-conflict level; European gas +16.9% in a month.
- A renewed rise would feed straight into transport inflation (already 13.8%) and the import bill.
2El Niño strengthening into 2027
- Above-normal Vuli rainfall could disrupt transport and food distribution; drought in southern SADC may raise regional food demand.
- Agriculture, transport and food prices are the channels to watch.
3Wider external deficit and shilling pressure
- Current-account deficit up 45.9%; reserves at 4.2 months of imports; shilling −6.7% y/y.
- Further depreciation would raise the shilling cost of dollar debt and imports.
4Credit boom and rate path
- Private credit +33%; CBR raised to 6.25%; BoT expects gradual moderation.
- A higher-for-longer rate path would raise borrowing costs for firms and government.
Inflation remains within target; revenue is above target (+5.4% in June; tax +12.5%); the 12-month goods-and-services export base grew 16.4%; reserves remain above benchmark; government securities are oversubscribed (bond bid-to-cover 3.4); and Zanzibar runs a growing current-account surplus. The balance of the data is "strong nominal momentum with a costlier external bill" .
06 — SourcesMethod & Source Note
Macro data: Bank of Tanzania, Monthly Economic Review, September 2026 (August 2026 data) — Sections 1.0–3.3 and Statistical Tables A1–A10, citing the National Bureau of Statistics, Ministry of Finance, Tanzania Revenue Authority, Ministry of Finance and Planning (Zanzibar), Office of the Chief Government Statistician, National Food Reserve Agency, the World Bank Pink Sheet and IMF WEO (July 2026). Recent figures are provisional and subject to revision; derived ratios (real rates, shares, percentage changes) are TICGL/TERI computations from the cited tables.
- Bank of Tanzania — Monthly Economic Review, September 2026
- TERI — Tanzania Economic Research Institute
B2 — Quick AnswersFrequently Asked Questions
What was Tanzania's inflation rate in August 2026?
Headline inflation was 4.3%, up from 3.4% a year earlier and inside the 3–5% target band. Core inflation was 4.1%, food 3.7% and energy 8.5%; core now contributes 3.1 of the 4.3 percentage points.
What is the Central Bank Rate and why was it raised?
The CBR is 6.25%, raised in July 2026 to contain second-round effects of higher energy, fertiliser and transport costs linked to the Middle East conflict.
Which sectors are seeing the fastest credit growth?
Transport and communication (77.2%), mining and quarrying (75.9%), trade (47.1%), building and construction (41.8%) and agriculture (38.4%); total private-sector credit grew 33.0%, and manufacturing credit grew 12.9%.
How has the shilling moved?
The shilling averaged TZS 2,657.01 per US dollar in August 2026, 6.7% weaker than a year earlier.
How large is the current-account deficit?
USD 2,481.8 million in the year to August 2026, against USD 1,700.9 million a year earlier. Exports of goods and services rose 16.4% to USD 20,216.2 million, while imports rose 21.4%; petroleum imports were up 51.7%.
How large is Tanzania's public debt?
National debt stood at USD 52,224.4 million, with domestic debt of TZS 40,899.5 billion and external-debt arrears of USD 1,040.0 million; the dollar share of external debt is 64.9%.
Muhtasari kwa Kiswahili
Taarifa za Uchumi wa Tanzania, Septemba 2026 — Data za Benki Kuu ya Tanzania (Agosti 2026) — Mfumuko wa bei wa jumla ulifikia asilimia 4.3 Agosti 2026 (asilimia 3.4 Agosti 2025), Kiwango cha Benki Kuu (CBR) ni asilimia 6.25 baada ya kuongezwa Julai, mikopo kwa sekta binafsi inakua kwa asilimia 33.0, na shilingi imeshuka thamani kwa asilimia 6.7 mwaka hadi mwaka (wastani TZS 2,657.01 kwa dola). Upungufu wa akaunti ya sasa umeongezeka hadi USD milioni 2,481.8.
Mfumuko wa bei: Mfumuko wa bei wa msingi (core) ni asilimia 4.1 na unachangia pointi 3.1 kati ya 4.3 za mfumuko wa jumla (Agosti 2025: 1.5 kati ya 3.4). Mfumuko wa chakula umeshuka hadi asilimia 3.7, lakini nishati ni asilimia 8.5, huduma asilimia 5.9 na usafirishaji asilimia 13.8.
Gharama ya fedha: Riba ya jumla ya mikopo ni asilimia 15.05, riba ya mikopo ya majadiliano ni asilimia 11.93, na mavuno ya hatifungani ya miaka 25 ni asilimia 11.48. Kwa mfumuko wa asilimia 4.3, riba halisi ya mikopo ni takriban asilimia 10.3 (hesabu za TICGL/TERI).
Sarafu na biashara ya nje: Mauzo ya bidhaa na huduma nje yalikua asilimia 16.4 hadi USD milioni 20,216.2 (dhahabu USD milioni 5,625.0, ongezeko la asilimia 30.2), lakini uagizaji ulikua kwa kasi zaidi (asilimia 21.4), huku bidhaa za mafuta zikipanda asilimia 51.7. Akiba ya fedha za kigeni ni USD milioni 5,888.2, sawa na miezi 4.2 ya uagizaji.
Bajeti na deni: Mapato ya serikali Juni 2026 yalikuwa TZS bilioni 4,658.2 (asilimia 5.4 juu ya lengo); deni la taifa ni USD milioni 52,224.4; deni la ndani TZS bilioni 40,899.5; malimbikizo ya deni la nje yamefikia USD milioni 1,040.0.
Zanzibar: Mfumuko wa bei ni asilimia 5.6 (Julai: 6.0), na ziada ya akaunti ya sasa ni USD milioni 953.7, ikichangiwa na mapato ya utalii.
Hitimisho: Uchumi una kasi imara ya kawaida (nominal), lakini gharama ya uagizaji kutoka nje na gharama ya fedha vinapanda; viashiria vya kufuatilia ni mfumuko wa bei wa msingi, kiwango cha riba, thamani ya shilingi na upungufu wa akaunti ya sasa.
- Mfumuko wa bei: 4.3% (core 4.1%, chakula 3.7%, nishati 8.5%)
- CBR 6.25%; riba ya mikopo 15.05%; mikopo ya sekta binafsi +33.0%
- TZS 2,657.01 kwa USD (−6.7% mwaka hadi mwaka)
- Upungufu wa akaunti ya sasa: USD milioni 2,481.8
Chanzo: TICGL/TERI, ikisoma Benki Kuu ya Tanzania, Monthly Economic Review, Septemba 2026. Kwa maelezo zaidi wasiliana na: economist@ticgl.com, WhatsApp +255 734 862 343.