The Monetary Policy Committee of the Bank of Mozambique (CPMO), meeting in Maputo on Wednesday, decided to hold the Bank’s benchmark interest rate steady at 17.25 per cent.

A statement from the CPMO said it decided not to lower interest rates because of the emergence of new risks and uncertainties associated with the projections for inflation. Of particular importance was “the potential impact of the current conflict in the Middle East on international fuel and food prices”.

The CPMO believes that the annual inflation rate can be held below ten per cent in the medium term – even though inflation rose from 4.6 per cent in September to 4.8 per cent in October. This increase was explained largely by rising prices of food and alcoholic drinks.

Nonetheless, single digit inflation (i.e. less than ten per cent) is still expected in the medium term, the CPMO says, reflecting the stability of the national currency, the metical and the impact of the central bank’s monetary policies.


The CPMO warned of underlying risks and uncertainties which include the pressure on Mozambican public finances, the possibility of extreme climatic events, and the unpredictable course of two foreign wars – Russia’s aggression against Ukraine, and the Israeli onslaught against the Gaza Strip.

The CPMO says that, excluding the liquefied natural gas (LNG) projects, there are prospects for moderate economic growth in Mozambique.

In the third quarter of 2023, it is estimated that growth, excluding LNG, reached 3.3 per cent, after 3.2 per cent in the previous quarter. But when LNG is included, growth rose from 4.7 to 5.9 per cent.

The CPMO warns of a continued increase in domestic indebtedness, which has now reached 334.4 billion meticais (about 5.3 billion US dollars, at the current exchange rate), an increase of 59.3 billion meticais since December 2022.

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