The Bank of Mozambique’s Monetary Policy Committee (CPMO) yesterday decided to maintain the monetary policy interest rate at 13.25%, justifying the measure with “the prospects of maintaining single-digit inflation”, announced the financial regulator.
The Bank of Mozambique proposed, in a statement, that the measure was taken in a context of “growing risks and uncertainties, with emphasis on the implications of the third wave of covid-19 in the economy”.
The note also refers that the CPMO also decided to maintain the interest rates of the Standing Deposit Facility (FPD) at 10.25% and the Standing Lending Facility (FPC) at 16.25%.
The Mandatory Reserve (RO) coefficients for liabilities in national currency and in foreign currency were also maintained at 11.50% and 34.50%, respectively.
“The risks and uncertainties associated with inflation projections continue to worsen. Internally, there is growing uncertainty about the impact of the third wave of covid-19 on the economy, with the emergence of more infectious strains, and the maintenance of military instability in the northern zone”, the text reads.
In the external environment, the document continues, the risks and uncertainties associated with the evolution of the pandemic also persist, in addition to the effects of recent demonstrations in neighboring South Africa, the strengthening of the US dollar and the increase in the price of oil and of food goods.
Inflation projections were revised upwards, remaining in single digits.
Annual inflation stood at 5.52% in June, after 5.49% in May, essentially reflecting the depreciation of the metical, notes Banco de Moçambique.