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Tanzania inflation rate rises to 9.4 pct in April

Discussion in 'Biashara, Uchumi na Ujasiriamali' started by Invisible, May 19, 2010.

  1. Invisible

    Invisible Admin Staff Member

    May 19, 2010
    Joined: Feb 11, 2006
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    DAR ES SALAAM, May 17 (Reuters)
    Written by Fumbuka Ng'wanakilala

    Tanzania's inflation rate rose in April for the first time since October last year as food and fuel price inflation picked up in east Africa's second largest economy, official data showed on Monday.

    The National Bureau of Statistics said the year-on-year inflation rate rose to 9.4 percent from 9.0 percent in March. The inflation rate had been declining steadily after hitting 12.7 percent in October 2009.

    The NBS said food inflation rose to 9.8 percent from 9.7 percent a month earlier while fuel, power and water prices were 19.9 percent higher than in April 2009, up from a 16.3 percent annual rise in March.

    The government is aiming for an inflation rate of 6 percent by June, although analysts have cautioned this target may be hard to hit due to rising fuel prices and expected increases in government spending ahead of elections in October.

    They also said the decision by donors to slash funding for Tanzania's next budget by nearly a quarter of a billion dollars would put pressure on prices.

    'There is a very strong possibility that Tanzania will return to a double-digit inflation rate in June or July,' Humphrey Moshi, professor of economics at the University of Dar es Salaam, told Reuters.

    'Fuel prices are now going up and this will automatically affect the inflation rate by putting pressure on food prices,' he said. 'The recent announcement by donors that they will cut budget funding to Tanzania will have negative consequences for the country's economy as a whole.'


    Inflation rates in Tanzania and its east African neighbours climbed into double digits during 2008 on the back of a surge in food and fuel prices. Inflation has since been slowing in all five members of the East African Community, helped by better harvests after a prolonged drought.

    Tanzania now has the highest inflation rate in the trading bloc, followed by Burundi, Uganda, Kenya and Rwanda, where it was just 2.05 percent in March.

    The government said it was confident it could maintain single-digit inflation, despite higher fuel prices.

    'Food prices carry a heavy weight in determining the inflation rate, so the government is keen to prop up the agriculture sector,' Deputy Minister for Finance and Economic Affairs, Omar Yussuf Mzee, told Reuters by phone.

    'We are not worried a lot about fuel prices. We need to control food prices by boosting crop production and building capacity to store food in strategic reserves, which can be flooded into the market whenever there is a deficit in order to bring prices down,' he said.

    The NBS said food prices, which have a weight of 55.9 percent in the consumer price basket, fell 0.1 percent in April thanks to declines in the cost of cereals, cassava, potatoes, cooking bananas, fruit, beans and nuts.

    The food price drop helped offset higher prices for drinks, charcoal, household equipment and recreation items leaving the overall price index down 0.1 percent on the month.

    Hali mbaya!
  2. K

    Kabengwe JF-Expert Member

    May 20, 2010
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    We are going to reach double digits before the end of this year!
    Not this government to take care of the situatuion.
    Atleast that, I'm sure.
  3. NGULI

    NGULI JF-Expert Member

    May 20, 2010
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    Mid rate and revalution of USD against TZS is 1,487.11 as of today.
  4. d

    damn JF-Expert Member

    May 20, 2010
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    Ikulu imejaa mbayuwayu watupu. Mnategemea nini?
  5. Liz Senior

    Liz Senior JF-Expert Member

    May 20, 2010
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