The cost of living in Mozambique may see a slight decrease according to the latest forecasts from Standard Bank. The bank predicts that by December this year inflation will stabilize at an average of 11.71 PT2T, after the August peak, estimated at 12.21 PT2T.

The scenario could derive from internal and external shocks, including the impact of climate change and the impacts of the Russian-Ukrainian war on oil prices, the bank's chief economist explained.

Quoted today by "O País Económico", Fáusio Mussá expects that until the end of the year, the Bank of Mozambique (BM) will maintain the reference interest rate for monetary policy (MIMO), at 15.25%.

"But there is no guarantee that this will happen, especially if there is some surprise that translates into higher than expected inflation," he warned.

Fáusio Mussá, who was speaking recently, in the virtual session of the Economic Briefing, showed concern about the fall in international reserves, which has resulted in the reduction of months of import coverage to about 4.7 months, which may have an impact on the evolution of the Metical.

Meanwhile, he says that in view of the increased foreign aid, the government can be expected to restore the level of reserves to a ratio of more than four months of imports in the coming months.

"That may help reduce some pressures that are in the foreign exchange market from a liquidity standpoint," he indicated.