Inflation hits 22% in Mozambique – By Joseph Hanlon

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Inflation hits 22% in Mozambique – By Joseph Hanlon

12:20 CAT | 15 Sep 2016

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The yearly inflation rate (1 September 2015 to 31 August 2016) is 21.96%. The monthly inflation rate rose to 1.27% in August, compared with 0.9% in July and 0.76% in June, according to the latest figures from the National Statistics Institute (INE), based on the consumer price indices for the three largest cities (Maputo, Nampula and Beira). (AIM En 11 Sep)

The increase is largely due to food prices. Cooking oil and soap both increased 10.3% in August.
Of the three cities covered by the survey, August inflation was highest in Maputo (1.75%), followed by 0.94% in Nampula and 0.52% in Beira.

Dollar devaluation continues, with the metical falling 6% in three weeks, from 72 Meticias to $1 on 21 August to 77 on Monday. Exchange rate against the rand was stable in the same period at 5.4 Meticais to 1 Rand. Minister of Economy and Finance, Adriano Maleiane blamed the devaluation on “large scale speculation”. Interviewed on STV he said “according to parity purchasing power, and bearing in mind inflation in the neighbouring countries, particularly South Africa, and the general level of prices in Mozambique, a dollar should cost 55 or 56 meticais”. (AIM En 12 Sep)

The Bank of Mozambique has denied reports that it has issued new directives curbing the amount people can withdraw from foreign currency accounts, but admits there is a squeeze because the commercial banks can only allow withdrawals of foreign currency they have, and there is a shortage of foreign banknotes due to the economic squeeze. (AIM En 10 Sep).

By: Joseph Hanlon

Source: News reports & clippings