Dar es Salaam. The central bank’s decisive move to curb indiscriminate use of foreign currency in domestic transactions is beginning to yield tangible results, with the Tanzanian shilling showing signs of appreciation and foreign exchange liquidity improving in the local market.
This was revealed on May 20, 2025 by the director of Financial Markets at the Bank of Tanzania (BoT), Mr Emmanuel Akaro, during a media seminar in the city.
According to Mr Akaro, the implementation of the Foreign Currency Usage Regulations, which came into effect in March this year, has significantly boosted the availability of US dollars in the domestic market — raising the daily supply from an average of $40 million to $69 million within a month.
“Those who previously conducted transactions in foreign currency are now compelled to first convert it and pay in Tanzanian shillings, a move that has bolstered our local currency,” said Mr Akaro.
He added that the volume of foreign exchange now circulating in the market has more than doubled compared to the same period last year, when the daily average stood at around $30 million.
This year, it has soared to nearly $70 million a day.
Mr Akaro further noted that the Bank of Tanzania continues to closely monitor the enforcement of its monetary policy to rein in inflation and maintain macro-financial stability. Inflation currently remains at a moderate level of 3.1 percent.
“To date, we have injected a total of $130 million into the market this year to ensure that foreign currency is sufficiently available, while also guaranteeing that domestic transactions are conducted in shillings as per the law,” he said.
The Foreign Currency Usage Regulations (Government Notice No. 198 of 2025), published on March 28, 2025 under the Bank of Tanzania Act, require all residents and businesses in the country to use Tanzanian shillings for the purchase of goods and services within the United Republic.
The regulations, which were issued by the minister for Finance, Dr Mwigulu Nchemba, aim to eliminate the arbitrary use of foreign currencies and strengthen the national financial system.
Authorities say the measures are part of broader efforts to safeguard monetary sovereignty, deepen confidence in the Tanzanian shilling, and promote sustainable economic growth.
