Mozambique PMI eases in August after July’s two-year high

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Mozambique PMI eases in August after July’s two-year high

8:05 CAT | 05 Sep 2025

File photo: Lusa

Economic activity in Mozambique declined in August, after the biggest growth in two years in July, according to the Purchasing Managers’ Index (PMI) by Standard Bank.

“Businesses in Mozambique continued to see an increase in private sector activity half-way through the third quarter of the year (…). However, the rate of activity growth slowed compared to the highest level in the last two years recorded in July,” the PMI survey reads.

The document also highlights that supplier delivery times “shortened markedly and stocks fell further” in August, despite “input purchases increasing for the first time since April”.

The survey adds that “selling prices rose during August” amid ” faster increases in both purchase costs and salary expenses”.

The Purchasing Managers’ Index (PMI) headline had risen from 49.1 in June to positive territory in July, at 50.7, but in August it fell again to 49.9.

PMI indicators above 50 points point to an improvement in business conditions compared to the previous month, while indicators below that value indicate a deterioration.

“The upturn in output was the second in a row in August, but the pace of growth weakened notably from July0s two-year high. Stronger activity was apparent in the construction and agriculture sectors, although this was largely offset by contractions in manufacturing, services and wholesale and retail,” the PMI survey notes.

The document also states that output growth in August was “broadly linked to an increase in new order volumes”, with the companies in the panel reporting that “improved client demand and larger buying quantities had boosted sales”.

The survey also notes that the “higher sales intakes resulted in a further increase in employment in August”, the third consecutive increase and the strongest in just over a year.

“Parallel to this, businesses expanded their purchasing activity for the first time in four months, which helped them to lower their backlogs from July’s level.” the document reads.

Quoted in the study, Standard Bank’s chief economist, Fáusio Mussá, points out that “business sentiment improved” in August, “with the PMI future business expectations sub-index up, with 42% of respondents forecasting growth in the next 12 months,” which “may well reflect positive expectations around progress on liquified natural gas projects (LNG), which should boost output”.

“We’d expect the improvement in sentiment to seal the recent deal between Qatari Investment firm, Al Mansur Holdings, and the government of Mozambique — committing USD20bn in investment in priority sectors, including agriculture, infrastructure, tourism, and oil and gas,” Mussá writes.

The economist points out that “the Qatari foreign direct investment (FDI) materializing should help ease foreign exchange (FX) supply-demand imbalances as well as help to meet some of the government´s development spending needs”.

Source: Lusa