Currency crises: Are we heading the Russian way?

[Kibanga Ampiga Mkoloni]

well if you follow the news carefully. Kenya and Uganda have sold dollars in the market. Since they are net importers like us they know that a rapidly depreciating currency is bad for the economy in terms of inflation etc. A gradual depreciation is not a bad thing because it can make our exports competitive. However, a rapid depreciation leads is negative for any economy because it can lead to financial instability (deposits being converted into hard currency).

Historically, we know that Bank of Tanzania is always reactive rather than proactive

MKuu Mimi nashaka kama hata Hizo Dollar RESERVe ipo hapo BOT.

hakika BOT itakuw ahaina hela hata senti ya kutupia kwenye market.

 

[Sangarara]

Tanzanian Shillings has been over valued for a very long time.

 

[Kibanga Ampiga Mkoloni]

Mchumi daraja moja yuko wapi??? CCM ukoo wa makoikoi tu!! Adam malima wapi? Saada mkuya wapi?? Kikwete yuko wapi??? Nec ya CCM iko wapi??? the full organ ya CCM iko wapi??

cc😡Mwigulu Nchemba

 

[Sangarara]

Leo Dollar imeshafikia 1805 kutoka 1600 ilipokuwa miezi kama 3 nyuma.

Ni shida

Still, That is very high.

 

[Fx Trader]

my friend, the assumption of the shilling being overvalued was based on the current account deficit which is expected to shrink due to lower oil prices and the relative inflation rate.

In times of a mismatch between inflows and outflows, the Central Bank should come into stabilize the market as the case in Uganda and Kenya.

The concern is the speed of depreciation which deviates the price levels from fundamentals. I also doubt if those reserves do actually exists in reality.

 

[flyingcrane]

Kuna wakati kenya pia hayo yaliwahi tokea..shilingi ikachezea 115 kutoka kwa 84ksh
Uzuri swala hili lilichukuliwa kama janga la kitaifa kiuchumi. kamati za bunge ziliundwa na hatua zikaanza kuchukuliwa maramoja..matokeo ya uchunguzi yalibainisha kuwa mkuu wa Central bank of Kenya(CBK) pamoja na maafisa wa ngazi za chini wengine walishirikiana kuihujumu shillingi ya kenya ili wafaidike(walinunua dollars kisha kucheza dili shilingi iporomoke ndio wageuze fedha walizonazo kwa shilingi za kenya ili kupata faida zaidi) ilibainika pia jamaa walikuwa wazembe na hawakufanya lolote kuzuia hali hii kutokea licha ya kujua mambo yangegeuka kuwa mabaya. hawa jamaa wote walipigwa kalamu mara moja

my take: nchi yenu iunde kamati maalum ya bunge ichunguze na hatua kali kuchukuliwa kwa waliohusika, hiyo tu ndio dawa.. kwanini mtu alipwe mshahara mnono na haezi fanya kazi vizuri

 

[Fx Trader]

I agree with you. Bank of Tanzania and Kamati should be more proactive rather than reactive. In addition: the immediate steps the central bank should take are the following:

1. Intervene to restore credibility of the local currency
2. Take disciplinary measures against banks found speculating

 

[Maundumula]

If you ask BOT watasema bado hawaoni sababu ya ku intervene soko linaweza kurekebisha hali.

 

[Fx Trader]

I feel sorry for nation. We lack market experts. As I mentioned before they are reactive and not proactive.

Kenya have already asked for a precautionary facility of usd 700-750 from the IMF! That is what you call forward thinking.

 

[YouTube]

baraza la mawaziri lote limelala, wanasiasa wa upinzani nao wamelala.

 

[Fx Trader]

As mentioned earlier. They don't care. Escrow has done wonders for the cabinet and made the wananchi worse! legacy of Kikwete and Beno!

 

[MchunguZI]

What are the actions taken by Kenya and Uganda Central Banks? And against which source(s) of currency depreciation? What is causing TZ shilling depreciation against USD? A weaker currency against the USD is not necessarily a bad thing. We are feeling the pain because Tz is a net importer.

Don't take me back to those years of Malimanomics! Haahaa! How can you lousily theorize on such strong and necessary economic factor in a country of this nature? Tanzania. In this country a weaker currency is always bad! I mean Bad! A country makes good out of the weaker currency when it's economically strong. When it has something to export. Do we have anything for export? What? Pembe za faru and elephant tusks?

This is simply a dying country.

 

[Zungu Pule]

Don't take me back to those years of Malimanomics! Haahaa! How can you lousily theorize on such strong and necessary economic factor in a country of this nature? Tanzania. In this country a weaker currency is always bad! I mean Bad! A country makes good out of the weaker currency when it's economically strong. When it has something to export. Do we have anything for export? What? Pembe za faru and elephant tasks?

This is simply a dying country.

We are on the same page then, except that I do not think Tanzania is a dying country (whatever that means).

I am yet to see an expert analysis on why our currency is/has been doing so badly against USD. Do you know?

 

[Bulesi]

hivi yule professor anafanya nini pale BOT?

Kikwete atakapoondoka mwezi wa kumi afadhali aondoke na gavana wake waende wakale fedha za Escrow walizokomba !! Hakuna RAIS makini atakayekubali kuwa na gavana kama huyu.

 

[Bulesi]

Leo Dollar imeshafikia 1805 kutoka 1600 ilipokuwa miezi kama 3 nyuma.

Ni shida[/QUOTE

Leo imefika 1825 na sio1805; gavana amelala anafikiria jinsi ya kula hela yake ya Escrow kiulaini maana yeye hajaguswa!!

 

[Bavaria]

We are doomed by lacking competent and visionary leaders.

 

[Fx Trader]

I totally agree with you. Beno is a complete failure. Bank of Tanzania's Mandate is price stability; which includes interest rates, inflation and the exchange rate. Is a depreciation from 1650 to 1805 in the space of just four months the definition of price stability? The shilling is the worse performing currency in EA, a depreciation of close 12% since January last year.

The main reason for the rapid deprecation of the shilling are:

 

[ZebraPlus]

Ni upepo tu utapita!

 

[Bulesi]

baraza la mawaziri lote limelala, wanasiasa wa upinzani nao wamelala.

Hata hivyo kamati ya uchumi ya bunge sidhani kama ina capacity ya kutafiti na kutoa ushauri maridhawa!! CCm imejaza wabunge vilaza mle kwenye mjengo; wasomi wazuri hawatakiwi ccm wanasema wanawayumbisha matokeo yake BOT wanalala hakuna wa kuwathibiti!! Wenzenu Kenya kamati yao ya uchumi imejaa watu makini na gavana wao anapoitwa anajua anakwenda kujibu maswali mazito na siokama hii mipasho ya magambas!!

 

[Fx Trader]

1. the withholding of donor aid -due to the escrow scandal and our President who pretends to care is dragging his feet to punish his friends,
2. globally the dollar is strong due to expected raise in U.S interest rates

Since, Tanzania is a small open economy the withholding of donor funding has a greater impact and therefore it can be defined as an external shock.

Under these circumstances a smart central banker would intervene to stabilize the market especially if this is seen as a temporary Shock.

Good Bless Tanzania