Mozambique lifts lending rate by 100 basis points to 10.75 pct

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Mozambique lifts lending rate by 100 basis points to 10.75 pct

8:53 CAT | 16 Feb 2016

In file Club of Mozambique.

Mozambique’s central bank lifted its benchmark lending rate by 100 basis points to 10.75 percent on Monday, the monetary policy committee said.

The bank said in a statement that deteriorating growth, rising inflation and the effect of the worst drought to hit southern Africa in decades had influenced its decision to raise its benchmark lending rate.

“The committee noted the likely impact of the adverse international environment, as well as the expected effects of the drought in the southern and central regions of the country and floods in the northern region,” according to a statement published on the bank’s website.

Inflation in Mozambique accelerated to 11.3 percent in January from 10.6 percent in December. The economy grew 5.6 percent in the fourth quarter of 2015, compared with 4.6 percent a year earlier, the National Statistics Institute said Feb. 5. The committee said the expansion in the fourth quarter had been below forecast.

Source: Reuters / Bloomberg