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The literal meaning is:
This expression can be translated in English as “I will keep you posted/updated/informed.” or even “I’ll let you know.“
It appeared during the 18th century and it basically comes from “Tenir au courant des affaires” which means “To know the streams of business“. Then, it took the broader meaning of “keep informed“.
A colleague wants an update about your work, but you haven’t finished yet.
Then you can say “Je te tiens au courant” (I’ll keep you informed). And your colleague would probably answer: “Ok, tiens moi au courant” (Ok, keep me informed)
Also, for a more formal version you can use “Je te tiens informé(e)” and for a more informal version “Je te tiens au jus“.