Shilling holds firm as bank rates differ

DAR ES SALAAM: THE Tanzanian shilling remained broadly stable against major foreign currencies yesterday, although commercial banks quoted varying buying and selling rates, highlighting differences customers face when exchanging foreign currency.

According to the Bank of Tanzania (BoT) reference rates, the US dollar was quoted at 2,629/- for buying and 2,655/- for selling, with an average rate of 2,642/-.

Commercial banks, however, quoted different rates, reflecting the prices customers could actually obtain when buying or selling foreign currency through the banking system.

At CRDB Bank, the US dollar was bought at 2,600/- and sold at 2,680/- yesterday, with the rates remaining unchanged from the previous week.

At NMB Bank, the dollar was bought at 2,595/- and sold at 2,675/-. The difference in buying rates means that customers selling the same amount of US dollars can receive different amounts depending on the bank they use.

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Such differences become more significant for businesses and individuals handling larger amounts of foreign currency, including importers paying for goods abroad, exporters converting foreign earnings into shillings, travellers exchanging money and families receiving remittances from overseas.

For the euro, the BoT reference rate stood at 2,982/- for buying and 3,012/- for selling. CRDB quoted the euro at 2,852/- for buying and 3,152/- for selling, while NMB’s rates stood at 2,828/- and 3,125/-, respectively.

For the British pound, the BoT buying rate was 3,478/- and the selling rate was 3,513/-. CRDB quoted the pound at 3,350/- for buying and 3,650/- for selling, while NMB bought it at 3,288/- and sold it at 3,639/-.

The Chinese yuan was bought at 372/- and sold at 417/- at CRDB, compared with NMB’s buying rate of 387/- and selling rate of 402/-.

Among East African currencies, the Kenyan shilling was bought at 20.25/- and sold at 20.44/-, while the Ugandan shilling stood at 0.66/- for buying and 0.67/- for selling.

The Rwandan franc was bought at 1.77/- and sold at 1.79/-.

While differences in exchange rates may appear small for consumers handling modest amounts, they can have a greater impact on larger transactions.

For businesses, foreign exchange rates can directly affect import costs, the value of export earnings and the amount required to settle international transactions.