The Government Securities Market is where the Tanzanian government raises domestic funds by issuing Treasury Bills (short-term) and Treasury Bonds (long-term) through competitive auctions conducted by the Bank of Tanzania (BoT). It serves as the primary mechanism for non-inflationary budget financing and development project funding.

As of early 2026, Tanzania's government securities market exhibits remarkable resilience: auctions remain consistently oversubscribed, yields have stabilized within the 9–12% range, and institutional demand continues to grow — reflecting investor confidence underpinned by stable inflation at 3.2% and projected GDP growth of 6.0–6.3%.

Treasury Bill auctions are conducted weekly by the Bank of Tanzania across four tenors: 35-day, 91-day, 182-day, and 364-day instruments. From October 2025 through January 2026, every auction was oversubscribed, a clear signal of sustained institutional confidence in short-term government paper.

Yields edged slightly upward from the 9–10% range in October 2025 to 11–12% by January 2026 — a reflection of tightening liquidity conditions and evolving market expectations ahead of the central bank's policy decisions. Crucially, this yield movement occurred within an orderly market, with the government consistently absorbing its full tender each auction cycle.

Alongside the weekly Treasury Bill auctions, the Bank of Tanzania conducts periodic Treasury Bond auctions for longer tenors ranging from 2 to 25 years. These bonds are critical instruments for financing Tanzania's long-term development agenda — hydropower, roads, industrial zones, and social infrastructure.

The January 2026 10-year Treasury Bond auction stands as a landmark result: oversubscribed by approximately 34%, with a weighted average yield of 11.30% — a borrowing cost that remains favorable by regional standards. The high demand reflects growing pension fund and insurance company allocations to domestic long-duration paper.

The Interbank Cash Market (IBCM) is where commercial banks lend and borrow short-term funds among themselves to manage daily liquidity positions. It serves as a critical transmission mechanism for monetary policy — interest rates here respond quickly to the Central Bank Rate (CBR) set by the Bank of Tanzania.

In January 2026, total IBCM turnover reached TZS 2,868.9 billion, a slight decline from December's TZS 3,481.9 billion — reflecting post-year-end normalisation rather than market stress. The dominant tenor was 7-day transactions, accounting for 73.2% of all interbank activity.

The table below synthesizes the most critical data points from Tanzania's financial markets as of January 2026, drawing from Bank of Tanzania publications and TICGL research. Together, these indicators paint a picture of a stable, well-functioning domestic financial system.