Central Bank holds reference interest rates steady, lowers inflation forecasts – Mozambique

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Central Bank holds reference interest rates steady, lowers inflation forecasts – Mozambique

6:18 CAT | 14 Dec 2016

File photo / The Central Bank building in downtown Maputo

The Mozambican Central Bank has announced its decision to hold reference interest rates, keeping the Permanent Assignment Facility [lending] at 23.25 percent, the Permanent Deposit Facility at 16.25 percent and the Compensation Reserve Ratio at 15.5 percent.

The Banco de Moçambique has also decided to compel commercial banks to disclose their solvency levels as of March 2017 and on a quarterly basis.

At a press conference held this afternoon, the Central Bank reported that in November annual inflation was at 26.83 percent, which means that it is now nearing its peak.

In effect, the Central Bank has revised down this year’s inflation to 27 percent, which means that it no longer foresees a generalised price increase of 30 percent.

In addition, the Bank of Mozambique forecasts a reduction in inflation, starting this month.

At today’s meeting, the Central Bank also revealed that it has injected eight billion meticais in Moza Banco to save the institution. When Moza is financially healthy, it must return the amount to Banco de Moçambique , which will be a privileged creditor, ie the first among creditors to receive.

Source: O País