The reference interest rate for credit operations will remain at 21.2% for the month of September, for the second month in a row, the Mozambican Banking Association (AMB) announced this Friday (30). This decision comes in the context of stabilising monetary conditions in the country.
The so-called ‘prime rate’, which serves as the basis for calculating the interest applied to bank loans, had been falling since 2018, reaching a low of 15.5 per cent in February 2021. However, from that date onwards, the rate reversed the trend and began to rise, reaching a maximum of 24.1 per cent in July 2023. In the following months, it gradually fell, settling at 23.5% in January 2024 and continuing to fall until it stabilised at the current 21.2% in July.
This figure is influenced by the monetary policy interest rate, known as the MIMO rate, set by the Bank of Mozambique (BoM). On 31 July, the central bank’s Monetary Policy Committee (CPMO) decided to lower the MIMO rate from 15% to 14.25%, justifying the decision with the expectation that inflation will remain in single digits in the medium term.
The ‘prime rate’ was created in 2017 through an agreement between the BoM and AMB, with the aim of unifying the reference rates for credit operations, eliminating the multiplicity of rates on the market. Since then, it has been revised monthly based on the prevailing economic and monetary conditions.
According to the AMB, maintaining the rate at 21.2 per cent aims to provide stability and predictability in credit operations, at a time when inflation projections remain under control, despite the uncertainties in the global economic scenario.
