Sept. 29 (Bloomberg) -- Tanzania’s shilling rose against the dollar, heading for its biggest two-day increase in more than a month as the central bank sold the U.S. currency.
The currency of East Africa’s second-biggest economy strengthened as much as 1 percent to 1,649.5 per dollar and traded up 0.3 percent at 1,660.5 by 3:09 p.m. in Dar es Salaam, the commercial capital. The currency has increased 1.5 percent in the last two days, heading for the largest two-day rally since Aug. 2. The shilling has depreciated 2.5 percent this quarter, a third of declines.
“The central bank came in and supplied dollars,” Yonoh Mtengule, chief economist at National Bank of Commerce Ltd., Absa Group Ltd.’s local unit, said by phone from Dar es Salaam. “Banks have been selling dollars since yesterday after buying dollars earlier this week as the shilling fell” to 1,685 per dollar on Sept. 27, the weakest since 1994, when Bloomberg started compiling the data. The dollar purchases “had no fundamentals to support them, they were out of panic,” Mtengule said.
Joseph Masawe, director of economic research and policy at the Bank of Tanzania, who Bloomberg was referred to for comment by an official who answered a call to the phone in the governor’s office, was not available.
Tanzania’s inflation rate climbed to 14.1 percent in August, the fastest pace in more than a year, on higher food costs, the National Bureau of Statistics said Sept. 15.
--Editors: Ana Monteiro, Linda Shen
-0- Sep/29/2011 12:29 GMT
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