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Tanzania Inflation Rate

The inflation rate in Tanzania was recorded at 9.80 percent in March of 2013. Inflation Rate in Tanzania is reported by the The National Bureau of Statistics (NBS). Historically, from 1999 until 2013, Tanzania Inflation Rate averaged 7.72 Percent reaching an all time high of 19.80 Percent in December of 2011 and a record low of 3.40 Percent in February of 2003. In Tanzania, the National Consumer Price Index (NCPI) measures the change over time in the cost of a fixed basket of goods and services that are purchased by a representative sample of households. The index weights are based on expenditures of both urban and rural households in the 21 geographic regions. The most important categories in the NCPI are Food and Non Alcoholic Beverages (47.8 percent of total weight); Transport (9.5 percent); Housing, Water, Electricity, Gas and Other Fuel (9.2 percent). Clothing and Footwear account for 6.7 percent of total index and Furnishing, Housing Equipment and Routine Maintenance of the House for 6.7 percent. Restaurants and Hotels represent 6.4 percent of total weight and Miscellaneous Goods and Services (personal care, insurance and financial services) for 4.5 percent. Alcoholic Beverages and Tobacco represent 3.3 percent of total weight, Communication 2.1 percent, Education 1.7 percent, Recreation and Culture 1.3 percent and Health 0.9 percent. This page includes a chart with historical data for Tanzania Inflation Rate.

n Tanzania, the year-on-year inflation rate slowed to 9.8 percent from 10.4 percent recorded in the previous month. Inflation rate fell into the single digit for the first time since May of 2011, mainly due to a slowdown in the rise of food prices. On the year-on-year basis, the headline inflation rate for the month of March of 2013 eased to 9.8 percent from 10.4 percent recorded in February of 2013. The rate of price increase for commodities in March of 2013 has fallen, when compared to the speed recorded in February of 2013. Prices of food consumed at home and away from home has declined to 10.7 percent in March of 2013 from 11.7 percent in February of 2013. In addition, food and non alcoholic beverages prices slightly decreased to 11.1 percent in March of 2013 from 12.0 percent recorded in February of 2013. However, the 12 month index change for non food products has slightly increased to 8.5 percent in March from 8.4 percent recorded in February. On the month-over-month basis, the headline inflation rate in March rose 0.5 percent when compared with 1.4 percent recorded last month. This increase is attributed to the price increase of non food items. Non food items that contributed to the increase in monthly inflation rate include clothing materials by 1.1 percent, water supply by 2.7 percent, charcoal by 12.6 percent, furniture by 0.6 percent, household textile by 0.6 percent, household electric appliances by 0.8 percent, medical services by 2.7 percent, Diesel by 0.4 percent and Petrol by 2.0 percent. The Annual Inflation Rate which excludes food and energy for the month of March of 2013 has decreased to 5.9 percent from 6.7 percent recorded in February of 2013. Annual Inflation Rate for Energy has increased to 22.6 percent in March compared to 18.3 percent recorded in in the previous month.

Table 1: Macroeconomic Indicators 2012 2010 2011 2012 2013 Real GDP growth 7 6.4 3.4 6.4 3.3 6.9 3.8 Real GDP per capita growth 4.1

2010 2011 2012 2013 CPI inflation Budget balance % GDP Current account % GDP 6.5 -7.1 -7.8 12.7 16.1 8.4 -6 -9.1 -3.9 -11.9 -11.1 -11.9

Demand Pull Inflation. This occurs when AD increases at a faster rate than AS. Demand pull inflation will typically occur when the economy is growing faster than the long run trend rate of growth. If demand exceeds supply, firms will respond by pushing up prices. 2. Cost Push Inflation. This occurs when there is an increase in the cost of production for firms causing Aggregate Supply to shift to the left. Cost push inflation could be caused by rising energy and commodity prices. See: Cost Push inflation Simple Diagram showing cost push inflation.