BoT records rise in monetary gold holdings

DAR ES SALAAM: THE Bank of Tanzania’s gold holdings rose by 3.6 per cent in September, strengthening the gold component of its assets and highlighting the importance of precious metals in the central bank’s financial position.

The Bank’s Statement of Financial Position as at September this year shows that the combined monetary gold and gold bullion holdings increased to 10.60tri/- from 10.24tri/- in August, a rise of approximately 365.3bn/-.

Monetary gold increased to 3.43tri/- from 3.16tri/-, while gold bullion rose to 7.17tri/- from 7.08tri/-, contributing to the overall growth in the two categories.

The increase highlights the changing composition of the central bank’s assets, with gold holdings accounting for a substantial share of its total assets. However, the monthly figures do not establish whether the rise resulted from additional purchases, valuation changes or other transactions.

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The Bank’s total assets declined by 0.7 per cent to 34.72tri/- in September from 34.96tri/- in August, despite an increase in gold holdings and foreign currency marketable securities. Foreign currency marketable securities rose to 7.61tri/- from 7.23tri/-, while cash and cash equivalents declined to 4.51tri/- from 4.71tri/-.

Other assets recorded a sharper fall, dropping to 862bn/- from 1.59tri/-, while loans and receivables decreased to 975.5bn/- from 1.07tri/-. The contrasting movements show why changes in individual asset categories need to be considered alongside the overall balance sheet to understand the central bank’s financial position.

On the liabilities side, the Bank’s total obligations increased to 31.22tri/- in September from 31.15tri/- in August. Currency in circulation rose to 10.73tri/- from 10.35tri/-, while deposits held by banks and nonbank financial institutions declined to 6.40tri/- from 6.88tri/-. Deposits from other holders increased to 4.53tri/- from 4.39tri/- .

Foreign currency financial liabilities also rose to 4.31tri/- from 4.27tri/-, while BoT liquidity papers increased to 1.62tri/- from 1.46tri/-. The Bank’s total equity declined to 3.49tri/- from 3.82tri/-, largely reflecting a fall in reserves to 3.39tri/- from 3.72tri/-. Its authorised and paid-up capital remained unchanged at 100bn/-.

The movement in gold holdings also comes amid changes in the Bank’s other asset categories, including foreign currency securities and cash balances. Monitoring these shifts provides a broader picture of the central bank’s asset composition and financial position, although further information would be needed to determine the factors driving the monthly changes.

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