Tanzania Holds Policy Rate At 5.75% As Inflation Stays Contained

Monday 19th January 2026

By inAfrika Newsroom

The Bank of Tanzania has kept its benchmark policy rate unchanged at 5.75% for the first quarter of 2026, extending a run of steady settings as authorities cite a stable inflation outlook and continued growth momentum. The Tanzania policy rate decision comes as several regional peers manage tighter financing conditions and higher risk premiums.

The central bank’s Monetary Policy Committee maintained the rate to support credit conditions while keeping price pressures contained. Official indicators published by the central bank show inflation at 3.6% in December 2025, within the range that policymakers have associated with price stability.

Market participants often look to policy rate direction as a guide to the cost of funding for commercial banks and, indirectly, for private sector borrowing. In Tanzania’s case, the steady stance signals continuity for businesses planning inventory finance, capital expenditure, and working capital facilities, especially in sectors tied to logistics, construction, and manufacturing supply chains.

Tanzania’s decision is also being framed domestically as a competitiveness factor within the East African Community, where interest rate differentials can influence investment location decisions and cross border capital flows, even when other drivers like infrastructure and market access remain dominant.

The central bank has also continued to communicate its policy stance through published indicators and scheduled MPC actions. That approach aims to anchor expectations and reduce uncertainty for lenders and borrowers, especially as global conditions remain sensitive to commodity prices and shifts in external financing.

For households, the key question is whether stable monetary policy translates into predictable credit pricing and continued access to financing for housing, education, and small enterprise activity, without triggering broader price instability.

Next steps

For Tanzania policy rate decision, attention shifts to inflation prints, liquidity conditions, and how banks pass through policy stability to lending rates for productive sectors. The MPC calendar and quarterly guidance will shape market expectations for whether the stance stays steady through the first half of 2026.

Why it matters

Tanzania policy rate decision matters because it affects credit cost, investment planning and private sector confidence. Regionally, predictable monetary settings can support cross border trade and long term project finance, especially where investors compare funding conditions across East Africa.