Bank of Mozambique Leaves the Benchmark Rate on Hold at 8.25%

The Bank of Mozambique decided on November 13th to leave the benchmark interest rate on hold at 8.25 percent, after the rate cut last meeting. The Monetary Policy Committee noted that while international conditions pose risks, the inflation rate is consistent with the target for 2013.

In October, Maputo´s monthly inflation rate accelerated for the first time in five months to 0.23 percent, mainly due to higher food prices. Cost of housing, water, electricity and gas and transport prices also contributed to the rise in the CPI. Mozambique’s inflation rate, which aggregates the price indices of Maputo, Beira and Nampula, had a similar behavior to Maputo’s inflation and rose 0.24 percent in October. 

The Bank noted again that recent inflation behavior reflects the stability of the metical in the domestic exchange market, the maintenance of administrative prices (such as petrol, diesel and wheat flour), and the favorable conditions for the domestic production of fruit and vegetables.

The Bank of Mozambique decided to intervene in the interbank markets in order to ensure that the stock of base money does not surpass 45893 million Meticais, at the end of November of 2013. It also decided to maintain the Standing Lending Facility interest rate at 8.25 percent; maintain the Standing Deposit Facility interest rate at 1.5 percent, and the Reserve Requirements Ratio unchanged at 8.0 percent.

Bank of Mozambique Leaves the Benchmark Rate on Hold at 8.25%

Joana Taborda |
11/13/2013 4:23:53 PM