The Monetary Policy Committee (CPMO) of the Bank of Mozambique decided on Friday to raise the monetary policy interest rate (MIMO rate) by two percentage points from 15.25% to 17.25%.

"The measure aims to ensure the return of inflation to single digits, in the medium term," he said, in a statement quoted by Lusa.

The CPMO felt that the international context justifies the measure.

"The volatility of energy and food prices at the international level is expected to continue, in view of the prolonged conflict between Russia and Ukraine, with the potential to trigger a spiral of sustained price increases at the domestic level," the Bank of Mozambique body detailed.

The country's year-on-year inflation was 12.1% in August, the highest value in the last four years and 11 months, announced the National Statistics Institute (INE).

As for the economic outlook, the CPMO maintains its forecasts of economic recovery in 2022 and 2023, "notwithstanding the prospects of slowing external demand."

"These forecasts are supported by the execution of the energy projects in Inhambane and in the Rovuma basin and by the beginning of the export of liquefied gas", soon, "in a context of the implementation of the program with the International Monetary Fund and the resumption of foreign aid from cooperation partners", he justified.

The next regular meeting of the CPMO is scheduled for November 30.