Our sectoral factor model reflects, in part, both concepts of core inflation.31  The sectoral factor model is our preferred measure of core inflation because it best predicts where headline inflation will converge to in the future once the transient noise dissipates, and is smoother than our other (relatively) more volatile core inflation measures.32 Based on this measure, core inflation is currently estimated to be 1.4 percent (figure 5), and has broadly tracked sideways over the past year.
More specifically, I want to thank the Bank of Tanzania and the Alliance for Financial Inclusion (AFI), for providing a platform for its members to enhance financial inclusion and for their continued and focused support towards this initiative.