The Mozambican private sector recovered in February after four consecutive months of contraction, reaching 50.9 points, compared to 47.5 in January, announced the Standard Bank Mozambique PMI Index released today, Wednesday (05)..

According to the document MZNews had access to, this improvement in business conditions comes after the post-election instability in the country subsided, also reflecting greater customer confidence, which has allowed demand to recover.

"Both production and sales volumes rose for the first time in four months, causing companies to increase their purchases of means of production in the sharpest way since August last year," reads the document, highlighting that the main figure calculated by the survey is the Purchasing Managers' IndexTM (PMI®), with indicators above 50.0 pointing to an improvement in companies' conditions compared to the previous month, while indicators below 50.0 show a deterioration.

In addition, business sentiment remained positive, although optimism fell slightly. Companies expect sustained growth in demand and an increase in the number of clients and acquisitions, despite the economic challenges that still remain.

"Expectations regarding future activity remained positive in February," the survey points out, noting that the degree of optimism has weakened since January and was one of the lowest recorded in the last four years.

Commenting on the results, Standard Bank Mozambique's chief economist, Fáusio Mussá, recalls that the post-election period saw "a contraction of the economy of 4.9% year-on-year in the fourth quarter of 2024, with the possibility of a further contraction in the first quarter of 2025 and probably a subsequent slow recovery".

"In this context, we forecast GDP growth of 3%in 2025, very close to population growth, but higher than the 1.8% recorded in 2024," he concluded.

(Photo DR)