BoT governors word on shilling, recession fears Thursday, 06 October 2011 22:41 Tanzania has no plan to pump more dollars into the money market to steady its shilling, but will deal with the main economic fundamentals instead.The governor of the Bank of Tanzania, Prof Benno Ndulu, said this yesterday. He said although the local currency has hit a 17-year record low against the greenback as importers appetite for dollars continues to rise amid a scarcity of foreign exchange in the money market, the bank would not move to defend the falling shilling.It wont be to our benefit if we decide to artificially stabilise our currency
we would rather continue to deal with the main economic fundamentals, he told The Citizen yesterday in a telephone interview.He was reacting to local experts who called on the country to swiftly move to defend the shilling, which has depreciated to the levels of hurting importers. According to him, the BoT has been selling the greenback on an average of $100 million per month for the past three months, for the purpose of controlling inflation.He said the move to stabilise the shilling would reduce the countrys competitiveness by negatively impacting on exporters as well as prompting tourists to opt to visit nearby countries with weaker shilling.The governor said the shilling has been weakening mainly because of the high inflation differential against the countrys trading partners and the mounting investors anxiety that has also distabilised other currencies.The countrys inflation rate climbed to 14.1 per cent in August on higher energy and food costs, the National Bureau of Statistics said last month.Commenting on projections by the experts that the continuing economic crisis in the Eurozone could trigger another economic downturn, double-dip recession, Prof Ndulu said the country was alert.hayo ni mawazo ya governor wetu!!!!!!!!