Maputo, Sept. 1, 2025 (Lusa) - The reference interest rate for credit in Mozambique is expected to fall by 0.7 percentage points in September to 16.5%, according to information released by the Mozambican Banking Association (AMB).
Since January 2024, the rate, known as the "prime rate", has been falling progressively, after six consecutive months at a high of 24.1%.
Fluctuations in the prime rate are linked to the monetary policy interest rate (MIMO rate, which influences the prime rate calculation formula) used by the central bank to control inflation.
The cut comes after a further drop in August to 17.20%.
On 31 July, for the ninth consecutive time, the Monetary Policy Committee (CPMO) of the Bank of Mozambique reduced the MIMO monetary policy interest rate by 0.75 percentage points to 10.25%.
"This measure stems essentially from the continued consolidation of the inflation outlook to one digit in the medium term, partly reflecting the favourable trend in international commodity prices, despite the maintenance, at domestic level, of risks and uncertainties associated with the projections," said the governor of the central bank, Rogério Zandamela, at a press conference in Maputo, at the end of the CPMO meeting, which is held every two months.
Zandamela added that, in the medium term, "a gradual recovery in economic activity is expected" in Mozambique, excluding the production of Liquefied Natural Gas, "favoured in part by the reduction in interest rates and the prospects for implementing projects in strategic areas".
According to the communication made by Rogério Zandamela, "the risks and uncertainties associated with inflation projections remain high" and "the likely factors for the increase in inflation in the medium term include the impact of the worsening situation on the State Budget, uncertainties regarding the speed of restoring productive capacity and the supply of goods and services and the effects of climate shocks".
"The CPMO will continue with the process of normalising the MIMO rate in the medium term. The pace and magnitude will continue to depend on the inflation outlook, as well as the assessment of the risks and uncertainties underlying the medium-term projections," it said.
PVJ/ADB // ADB.
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