Fitch Solutions has improved the perspective of the evolution for the exchange rate in Mozambique’s currency, forecasting that it will take 71, instead of 74 meticais, for each US Dollar at the end of this year.
“We anticipate that the metical will devalue from a rate of 63.75 meticals to the dollar in the coming months, as we expect the current violence in Cabo Delgado province to continue and we anticipate that the Bank of Mozambique will ease monetary policy in a context of the covid-19 pandemic maintenance as an obstacle to economic growth and inflation control”, the analysts wrote.
In a comment on the evolution of the metical sent to investors, Fitch Solutions points out that, despite the negative scenario, the forecast for the end of the year was improved upon.
“We revised our forecast for the end of the year from 74 to 71 meticais to the dollar due to the improvement in the prices of coal and aluminum”, two of the main exports of Mozambique.
For 2022, Fitch Solutions anticipates that the Mozambican currency will continue on an upward trajectory, reaching a value of 67 meticais per dollar in December of next year, “with gas and coal exports increasing, together with the rise in foreign investment, that sustains the demand for the currency”.