Standard Bank forecasts inflation of 11.7% in Mozambique

Standard Bank highlights the impact of measures announced by the Mozambican government to subsidize transport and fuel imports to ensure certain price stability.

“The most vulnerable layers of our society are the most affected by the increase in fuel prices,” he said.

“In this scenario, we expect that the Bank of Mozambique will maintain the monetary policy reference interest rate (MIMO) until the end of the year at the current level of 15.25%,” he added.

Fáusio Mussá says he is concerned about the fall in international reserves, leading to a reduction in import coverage to 4.7 months.

“Given the increased foreign aid (from the World Bank, International Monetary Fund, and other partners), it is expected that the government will be able, in the coming months, to restore the level of reserves to a ratio of more than four months of imports,” he added.

“This may help to reduce some pressures that are registered in the foreign exchange market from a liquidity point of view,” said Fáusio Mussá.

With information from RTP

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