The Monetary Policy Committee (CPMO) of the Bank of Mozambique (BM) decided yesterday to maintain the monetary policy interest rate at 13.25%. This is the reference indicator for fixing the interest rate practiced by commercial banks in their relationship with customers.

The decision is supported by the slightly improved outlook for domestic inflation in the short and medium term, despite the worsening risks and uncertainties, associated with fiscal pressure, climate shocks in the country and rising oil and food prices in the international market.

According to the statement issued by the WB, the risks and uncertainties associated with inflation projections have worsened. In effect, at a domestic level, the increase in fiscal pressure in view of the enormous challenges the country is going through, the uncertainties regarding the extension and magnitude of the effects of Covid-19 on the economy and the impact of climate shocks stand out.

As for the inflation outlook for the short and medium term, these were revised downwards, remaining at single digits.

The WB reports that annual inflation remained stable in December 2021, at 6.71 PT2T, after 6.81 PT2T in November, favored by the reduction in the price of food and non-alcoholic beverages, in a context of stability of the Metical.