The Bank of Tanzania announced on January 8 that it will keep its central bank rate (CBR) unchanged at 5.75% for Q1 2026. This marks the third consecutive quarter the rate has been held steady, reflecting stable inflation and strong economic fundamentals.

Key Points

• CBR maintained at 5.75%, unchanged from Q4 2025
• Inflation averaged 3.5% in mainland Tanzania in Q4 2025
• Mainland GDP projected to grow 6% in Q1 2026; Zanzibar at 7.2%

Background

BoT Governor Emmanuel Tutuba noted that the decision supports sustained economic expansion while keeping inflation within the 3%-5% target range. Growth continues to be driven primarily by agriculture, mining, and construction sectors. The stable rate environment has helped Tanzanian banks maintain healthy financial soundness indicators, though liquidity management remains a key focus.

What This Means

For businesses, the rate hold means borrowing costs remain favorable heading into 2026. Commercial lending rates, which typically price off the CBR, should stay competitive for investment and working capital needs. The next monetary policy decision is scheduled for April 3, 2026. Markets widely expect the accommodative stance to continue as long as inflation remains contained.