Mozambique’s private sector activity improves in October, PMI shows

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Mozambique’s private sector activity improves in October, PMI shows

3:16 CAT | 06 Nov 2025

File photo: Lusa

Mozambique’s economic activity recovered in October, with conditions in the private sector improving for the first time in three months, according to the PMI index released on Wednesday by Standard Bank, acknowledging the return of economic growth this quarter.

“Private sector conditions in Mozambique improved for the first time in three months in October, supported by renewed growth in new business and greater increases in both activity and employment. Purchases of inputs also rose, though inventories declined further,” the PMI (Purchasing Managers Index) study reads.

Quoted in the report, the chief economist at Standard Bank Mozambique notes that “despite increased risks to macroeconomic stability stemming from entrenched fiscal and FX liquidity pressures, the October PMI shows business sentiment remains positive. The PMI future business expectations sub-index remains above 50, likely supported by progress in liquefied natural gas (LNG) projects.”

“Mozambique’s economy experienced negative GDP growth in Q4 2024, Q1 2025, and Q2 2025. We expect GDP growth to turn positive from Q4 2025, supported by robust base effects,” Fáusio Mussá writes.

The Mozambican economy recorded year-on-year contractions in Gross Domestic Product (GDP) in the last quarter of 2024 (-4.9%), the first quarter of 2025 (-3.9%) and the second quarter (-0.9%), impacted by the social unrest in the period following the general elections on 9 October, 2024.

The PMI report adds that in October, “a fresh rise in new business intakes, which matched July’s rate as the joint-strongest increase in just over a year,” was “central to the upturn.”

“Survey respondents frequently attributed this growth to winning new clients amid a broad strengthening of market demand. As order books improved, Mozambican firms expanded their output for the fourth consecutive month. The pace of activity growth accelerated from September, reaching its fastest since July,” the report points out.

The October PMI also notes that increases in production and sales were driven mainly by the construction and services sectors and that the “notable gains in these parts of the private sector somewhat masked more subdued performances observed in manufacturing, wholesale & retail, and agriculture.”

The report also points out that employment levels rose for the fifth consecutive month “at the joint-fastest rate since July 2024 (alongside August),” and that “purchasing activity accelerated as firms highlighted increased input requirements and purchases related to new product launches.”

READ: Sales growth returns in October, driving output and employment gains – Mozambique PMI

The PMI index had risen from 49.1 in June to positive territory in July, at 50.7, but in August it fell back to a negative figure, to 49.9, and in September to 49.4, recovering in October to 50.4 points.

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

Source: Lusa