After a volatile couple of years there have been signs that the shilling is now stabilising at a level of around TSh1,500:US$1, and this is expected to continue into 2011, with an average rate of TSh1,507:US$1. Strong exports, increasing foreign reserves and inflation below recent historical averages will all help the shilling, although confidence will remain fragile and will be linked closely to global trends; the movement of the US dollar against the important export market of the euro zone will have a significant effect. The story will be broadly similar in 2012, although the slightly wider current-account deficit is expected to exert some downward pressure, with the shilling averaging TSh1,534:US$1 for the year as a whole.