Inflation in Mozambique in 2017 may be single-digit

27 October 2017

The projections of the Bank of Mozambique (BM) point to inflation in December of this year of a single digit, Mozambican news agency AIM reported on Friday.

According to the governor of the Bank of Mozambique, Rogério Zandamela, despite these projections, the risks of inflationary pressures remain high.

AIM said that Zandamela on announcing the decisions made by the Monetary Policy Committee (CPMO) in Maputo, said that in September year-on-year inflation slowed to 10.76%.

He added that the stability of the Metical exchange rate against the US dollar and the South African rand continues to favour slowing inflation.

The international reserves of the Bank of Mozambique continue to grow stronger. Until 20 October, gross reserves increased to US$2.514 billion, or enough cover 6.1 months of imports of goods and services, excluding the major projects, in a context in which the sales by the BM amounted to US$365 million, intended to pay for fuel imports.

Meanwhile, provisional data showed that the trade deficit decreased substantially in the third quarter of 2017 and the level of internal public debt continues to increase.

According to AIM’s figures from 25 October internal public debt has risen to 100.5 billion meticais, against 97.7 billion in the last session of the CPMO on 10 August.

The CPMO considered, however, there is room for a moderate and immediate lowering of interest rates. (macauhub)