The Bank of Mozambique’s Monetary Policy Committee (CPMO) has announced that the monetary policy interest rate, also known as MIMO, will remain at 17.25%.
This decision is grounded on a range of factors such as potential risks, uncertainties, and pressure on public expenditures, along with ongoing international conflicts.
Despite these challenges, the bank expects inflation to remain in single digits in the medium term.
In June 2023, the annual inflation rate dropped to 6.8%, largely due to a decrease in food prices brought about by seasonal changes and a stable exchange rate.
However, the bank acknowledges that inflation projections still carry substantial risks and uncertainties, particularly in relation to price fluctuations of administered goods like liquid fuels.
The Bank also noticed an increase in domestic public debt, excluding loans and lease contracts, and respective overdue liabilities, to 308.4 billion meticais (4,372 million euros), a 33.3 billion meticais (472 million euros) increase since December 2022.
The CPMO has committed to closely monitor these risks and uncertainties, ready to make necessary adjustments as required. The next CPMO meeting is set for September 22.