Currency crises: Are we heading the Russian way?

[Kongwamaji]

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.

Kama msomi, why don't you recommend some measures that you can be taken to rescue the depreciating shilling?

 

[Kongwamaji]

Well why do you think donors have withheld funds?

So Uganda and Kenya donors did the same?

 

[The Khoisan]

You speak about the speed of depreciation,have you done any analysis on other major currencies, how about Malawi and Zambia? Donor withholding has never been a factor, We have enough reserves and even recently we got ENCB from china 300 USD, so donor fund is not a big deal

Although I am a scientist but your point does not add up. About 40% of our budget depends on the donors. I fail to understand how this will not affect us? Probably you should explain how Mwigulu will cover up the gap. If it's true that we can do it without them this time around then we don't need them at all.

 

[TAU 1]

Hi Friend

Your thoughts on the rapid depreciation of the shilling against the US dollar. All EA currencies have depreciated against the USD dollar sine the beginning of the year. Tanzanian currency is the worse performer

1. Tanzanian Shilling has depreciated by over 6%
2. Kenyan Shilling has depreciated by 1.2%
3. Ugandan Shilling has deprecated by 4%


In addition, Kenyan and Uganda Central Banks have intervened to slow down the deprecation. Why not Tanzania? at an average of 6% per month we will be one of the worse performing currencies in the world! God bless Tanzania!

This is a very serious issue which needs clarification from BOT!plus it affects country economy ruthless but it is also affecting individual economy,shall be very much surprised if BOT and Treasury shall remain silence!God have mercy with our country TZ...

 

[erique]

I have done my research more than you have. When I compare Tanzania with other EA currencies it is because the structure of the economies are similar. Even during yhe 2011 crises all three central banks acted simultaneously.

Malawi for your information and please go do your research are extremely dependent on donor aid and when the donors suspended aid inflation went of the roof and t bills were at double digit levels. The interbank market had no offers (if you know anything about trading).

Zambia have their own problems; it was the negative sentiment created by the previous president tax policies.

Where is the 300m? If they have enough reserves why dont they use it? Reserves are used in times of crises or mishavior of the exchange rate like in the case of kenya and Uganda.

No,here is how you are wrong, you real cant compaire Tanzania and Kenya interms of demand for and supply of USD, thats even why i mentioned Zambia and Malawi, because we look alike interms of our BOP. Having double digit tbills rate is not an issue, - our tbill rate has been double digit for a period of time, but now inflation is now 4.8%. Just go and read again, EA countries are not similar thats why we will have Monetary Union by 2024, so that we have enough time to restructure and become alike. If CBK entervened dont think the BOT will just do that without a strategy.

This is not a crisis, and the BoT is watching, and when it comes a rime for BOT to entervene, the BoT will certainly do that.The BoT has more than enough reserves to do what ever its right, thats why BOT has been selling USD to commercial banks daily.

What ia happening we call it just artficial demand for USD and speculation that donors have withheld therefore there will short supply of USD. The BOT may supplies you and you will burn your fingures.Just keep on playing with fire:-(

 

[The Khoisan]

By the way, have someone seen Mwigulu's contribution? I would like to see his comments on this. Wamezoea kupiga blah blah huko mtaani but avoiding serious National issues!

 

[erique]

Although I am a scientist but your point does not add up. About 40% of our budget depends on the donors. I fail to understand how this will not affect us? Probably you should explain how Mwigulu will cover up the gap. If it's true that we can do it without them this time around then we don't need them at all.

Dont copy old statistics, go check again, its no longer 40%

 

[Entim]

How do I capitalize on this ?

Logical question. Buy enough dollars and sell it in the next 3 months

 

[Fx Trader]

My friend I think u need to go back to basics. You just dont compare BoP that is only stat. If the countries are similar than why dont tanzania instead go and form the monetary union with zambia and malawi? They reason they have set a target of 2024 is because they need to align their macro economic targets first.

If Tz economy is not similar to kenya and uganda than why did tz only liberalise its capital account to EA? Are u aware you even aware of that? Why not Zambia and Uganda? Get your facts right buddy.

Fyi, tz is also phasing out its reserve money policy t

If BoT has enough reserves than why dont they intervene? You said they are watching. But watching and doing what?

If you think some banks are creating artifical demand than why dont BoT punish them? Or that is not part lf their mandate?

 

[Fx Trader]

Dont copy old statistics, go check again, its no longer 40%

I dont tbink its 40% but its a significent part of the development budget (80%) I think . I stand be corrected.

 

[Wacha1]

Hi Friend

Your thoughts on the rapid depreciation of the shilling against the US dollar. All EA currencies have depreciated against the USD dollar sine the beginning of the year. Tanzanian currency is the worse performer

1. Tanzanian Shilling has depreciated by over 6%
2. Kenyan Shilling has depreciated by 1.2%
3. Ugandan Shilling has deprecated by 4%


In addition, Kenyan and Uganda Central Banks have intervened to slow down the deprecation. Why not Tanzania? at an average of 6% per month we will be one of the worse performing currencies in the world! God bless Tanzania!

Kwani hufahamu Tanzania wanatumia pesa za aina mbili? Yaani US dollars na shilingi? Waifute tu hii shilingi wafanye kama Zimbabwe maana wanaoumia ni walala hoi. Lets change to US DOLLARS AND DITCH THIS USELESS SHILLING SI ALICHEMA NI ZA MADAFU HADHARANI.

 

[TGInnocent]

Professor Ndulu maybe a renowned economist but he has failed to stabilize the currency. He made the same mistake in 2011; at the height of the currency crises. Remember the depreciation from 1530 to 1850? in the space of 4 months; if no immediate action is taken we are heading in the same direction.

This situation is really bad if it persists. Just to make a contribution of knowledge on how foregn exchange rates rise and fall in a very layman understanding. Taking the USD as our forex, it means
1. The demand for USD in our forex market is higher than the supply.
2. That, TZS are chasing the USDollar, we can say many people now prefer to keep in their pockets more Dollars than Tshs.
3. Usually, normal trade especially exports should minimize this gap.

With this little understanding, let us exprole some reasons and see where things are not going
1. Usually when presidential election approach many businessman (especially Indians) tend to close their business and temporarily go outside the country (many go to Canada) for fear of chaos. You can make comparison with other electoral years.
2. The escrow withdrawals drained a huge amount of USD from the banking system. Note that even the amount drawn in TZS is now quickly being converted into Dollars, the 'fisadies' will not be confortable keeoing madafu money. These guys will buy the USD at any rate they get at a bureau thus driving the exchange rate high
3. The budget funding witheld by development partners could have given BoT some breathing to intervene. It is likely that the coffers at the great bank are drained
4. Unlike Kenya who run to IMF for help, It is not easy for TZ to approach these organs because so many financial scandals have put a question mark on transparency and credibility of our goverment. Particulary on how TZ handles corruption cases. The international community sees PCCB as a government organ of covering or cleaning corrupt officers. Statitistics show that middle and lower officers are taken to court while gland corruption end up at PCCB offices

I expect people statistics to chip in.

 

[Mag3]

Mi nadhani hizi ndizo uzi ambazo Mh.Naibu Mwigulu Nchemba anatakiwa unatakiwa uje uzitolee majibu na sio zile za kukanusha kupotea angani na helkopta kwa masaa sita.

Nitashangaa sana kama hoja ile ulijitokeza haraka sana kuitolea ufafanuzi lakini hii ya kuhusu uchumi wa nchi yetu utakaa kimya!

Nani? Mwigulu Nchemba? Aingie humu...you've got to be kidding!
​

Yuko bize anaikamua CCM au niseme Tanzania?
This is all he is good at!
​

 

[Mto]

A real good opportunity for some of us who know the "knowhow" of colluding with your government to organize grand corruption and fraud. We are planning to meet JK to discuss with him so that his government gives us a share of "stimulus package" from the tax payers money!

 

[kakaamiye]

What do you expect for a country that imports everything including Chinese street hawkers (machingas)??
Don't dare to compare Tz with the Russia... be as it may...they are by far better than us...

Asante Omuga! Asilimia kubwa ya bidhaa katika masoko ya nchi zetu zinatoka China, hivyo basi hazina kubwa ya fedha zetu za kigeni (US$) huelekea huko. Kwa taarifa ni kwamba, wachina wana sherehe zao za mwisho wa mwaka wao kuanzia mwezi wa pili na wote wanarudi kwao kusherehekea na hawafanyi biashara. Wanachofanya, Wananunua dola zetu na watasepa nazo hadi baada ya mwezi wa tatu ndio unafuu utaonekana. Nawatakia kila la heri!

 

[Cynic]

Yote kwa yote TZS inafanya vizuri sana vs. EUR & Yen

 

[aminiusiamini]

Ngoja watakuja wale wanacccm watamtetea the bogus president tulishawahi kuwa nae bora hata mzee mwinyi.

 

[BAK]

Ndiyo matatizo ya nchi kuwa mikononi kwa mbululas they don't give a damn about what is going on in our beautiful country. DHAIFU hajali yanayoendelea nchini na mbulula watatu pale hazina hawajui nini kinaendelea pale, wawili hawasikiki kabisa na mmoja yuko busy kukwea helicopter kuuza sura huku na kule kuwania Urais. Na yule professor mwingine pale BoT yupo yupo tu kupika namba za uongo kuonyesha uchumi kwa mwaka "unakua" kwa 7% huku umaskini uliokithiri ukizidi kushamiri na treasury's coffers zikiendelea kuwa empty.

 

[gwijimimi]

hivi yule professor anafanya nini pale BOT?

Anakula kiyoyoz

 

[Mabulangati]

Sorry, I don't follow you. This is a question of macroeconomics, and one has to look at the economy as a whole.

Russia! Tunataka kujilinganisha na Urusi?
Nilidhani mtu atasema Kongo, Zimbabwe, Somali, Laos, Vietnam, Mysrmar nk.

By the way tuache tabia ya kujinganisha na watu tunapoangalia uchumi wetu maana ndicho kinachotuangusha. Kila kitu siasa sisiem hivi ukawa vile as if wako nchi tofauti. Kuna mtu kasema BOT na wizara wako kimya hicho ndicho cha kuangalia itoke taarifa ya nini kinachoendelea, nani anayesema sasa hiyo USD iwe bei gani kwa madafu, doo au karamoja? Je zile nchi zenye currency kubwa kuliko USD kama Oman je ni matajiri au uchumi wao ni mkubwa kiasi gani zaidi ya Marekani?

There are several things vya kufafanuliwa na si kutoa changamoto isiyoweza kufanyiwa ukarabati.