Mozambique's benchmark interest rate will remain at 18.9% in September, the Mozambican Association of Banks (AMB) announced this Tuesday.

It will be the sixth consecutive month of maintenance of the prime rate, which has been fixed at that value since April 1st.

As in previous months, the rate for September calculated by AMB and Banco de Moçambique is based on a single index of 13.3% (calculated by the central bank) and a cost premium of 5.6% (defined by AMB).

The creation of the 'prime rate' with an initial value of 27.75% was agreed between the central bank and the Mozambican Association of Banks (AMB) in June 2017 to eliminate the proliferation of reference rates on the cost of money.

The goal is that all credit operations will be based on a single rate, "plus a spread, which will be added to or subtracted from the prime rate according to the risk analysis" of each contract, explain the promoters.

Lusa Agency