Bank of Mozambique Leaves the Main Interest Rate Unchanged At 9.50%

In its meeting held on May 9th, the Monetary Policy Committee left the benchmark interest rate unchanged at 9.50 percent.

According to the Monetary Policy Statement released by the Bank of Mozambique, in the first four months of the year, inflation rate has been rising steady, as a result of severe floods that hit the country in the beginning of the year. In fact, disruptions of food supply in a few markets, together with the increase of commodity prices and the strength of the US dollar in the domestic market, have created an upward pressure on the inflation rates, both at the national and regional levels.   

Also, the Bank of Mozambique referred that the economic climate indicator, which has been on an upward trend since July of 2012, slightly declined in March, hurt by low levels of optimism from a few sectors of the economy (transportation, restaurant and hotels). Demand expectations also showed a deteriorating outlook, while employment stance remained positive.
Preliminary data shows that in March, private sector indebtedness expanded by 2.63 billion MZN, reaching 122.36 billion MZN, and recording an annual increase of 23.5 percent, the Bank of Mozambique said. Also, in April, the Metical weakened against both the US dollar and the South African Rand. 
The Monetary Policy Committee said that it reaffirms its commitment to pursue a prudent monetary policy, in order to mitigate the external effects on the performance of the main macroeconomic indicators.
The Bank of Mozambique decided to intervene in the inter bank markets in order to ensure that the stock of base money does not surpass 39.700 million meticais, at the end of May 2013. It also decided to maintain the Standing Lending Facility interest rate unchanged at 9.5 percent; maintain the Standing Deposit Facility interest rate unchanged at 2.25 percent; and maintain the Reserve Requirements ratio unchanged at 8.0 percent.

Joana Taborda |
5/10/2013 4:26:10 PM