Bank of Mozambique keeps main interest rates unchanged, but plans to reduce monetary mass

14 January 2013

The Bank of Mozambique kept its main interest rates unchanged, but announced it plans to intervene in the monetary market in order to reduce cash in circulation to 38.5 billion meticals at the end of January.

In a statement issued Friday in Maputo, the Mozambican central bank said that the Monetary Policy Commission had decided to keep interest rates unchanged on its permanent liquidity and deposit facilities at 9.5 percent and 2.25 percent, respectively, and that the required reserve rate remained at 8 percent.

The decision was made in order to meet the economic targets set for 2013 of 6.5 percent inflation at the end of the period and 8.4 percent real gross domestic product (GDP) growth, along with inflation projections for the short and medium term.

The central bank also said that the average interest rate on one-year loans offered to the public by retail banks was 21.49 percent in November, which was a drop of 50 basis points against the previous month.

For the same maturity, the average interest rate on deposits fell in the same month by 1.14 percentage points to 10.64 percent and the average prime rate of the banking system stood at 15.46 percent in December, which was a drop of 41 basis points against the previous month. This trend continued and the average prime rate fell by 5 basis points in January 2013 taking it to 15.42 percent. (macauhub)

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