The shilling gained ground against the euro and the British pound over the last three months, a report show.
According to the Bank of Tanzania’s report, the local currency appreciated by an average of 4.6 per cent against the euro and 7 per cent against the pound.
The report states that the euro selling rate was at Sh2,774.21 on April 4 compared with Sh2,653.88 yesterday while the buying rate for the euro fell to Sh2,626.47 yesterday from Sh2,746.07 on April 4.
The local currency appreciated against the pound, to a selling price of Sh3,003 yesterday from Sh3,176.79 recorded on April 4 while the buying rate went down to Sh2,972.59 from Sh3,144.67 respectively.
The value of the local currency has been against the euro and the pound since the start of this year.The BoT director of Economic Research and Policy, Mr Johnson Nyella, attributes the shilling strengthening to market forces.
“Currencies gain or lose strength from day-to-day due to market forces, which you can’t predict,” Mr Nyella said, adding that one of the central bank’s functions is to ensure stability of the local currency.
Currency appreciation in the same context is an increase in the value of the currency.
Currency depreciation is the loss of value of a country’s currency with respect to one or more foreign reference currencies, typically in a floating exchange rate system.
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