Mozambique’s domestic public debt continues to rise, central bank says

14 February 2019

Mozambique’s domestic public debt including Treasury Bills, Bonds and advances from the Bank of Mozambique reached 112.525 billion meticais (US$1.787 billion) at the end of January, the central bank said.

The latest statement from the Bank of Mozambique’s Monetary Policy Commission on 11 February said domestic public debt increased by 590 million meticais (US$9.3 million) over the period since the commission’s last meeting (13 December 2018).

The same document added that the stated amounts do not take into account other values of domestic public debt, such as mutual leasing and finance contracts, as well as past due liabilities.

Despite the increase in public debt, the Bank of Mozambique said the current conditions of the Mozambican economy are likely to lead to low and stable inflation, of around one digit, in the short and medium term.

This outlook is underpinned by expectations of reduced fuel prices on the international market and price stability in Mozambique’s main trading partners, within a framework of contained aggregate demand.

However, the Commission considered it was advisable to maintain a prudent monetary policy, with the result that the main benchmark market rates were kept unchanged, including the MIMO rate, which remained at 14.25%. (macauhub)