The economic week in Mozambique was marked by information of interest and encouragement to business activity. On a positive note, the recovery of the tourism sector was announced, particularly during the Christmas and year-end festivities. According to data shared by the National Director of Trade and Services Provision at the Ministry of Economy, Joel Nhassengo, 311.7 thousand tourists visited the country, generating revenues of €22.7 million.
Speaking during the presentation of the Preliminary Balance of the Festive Season, the official explained that the number of guests received was about 2.3% above projections, adding that since 15 December, 199 New Year’s Eve events were held across the country, especially in coastal tourist destinations, where resort occupancy rates ranged from 33% to 100%.
He also noted that the festive period was characterized by high population mobility and intensified economic activity, with the government ensuring price stability and the availability of services and products. “Overall, the festive period unfolded with calm and normality in the functioning of the economy. Some isolated incidents were recorded, mainly associated with increased road and cross-border traffic and pressure on certain services. These situations were promptly addressed by the competent authorities through coordinated responses,” he explained.
Economic activity resumed growth in December 2025, reinforcing optimism for 2026
Another positive development is that the economy recorded, in December, and consecutively, growth in private-sector activity, reaching its best performance in ten months, according to the Purchasing Managers’ Index (PMI) released by Standard Bank. The report highlights a generalized improvement in output, order volumes and employment, while reinforcing business confidence for 2026.
Mozambique’s PMI reached 50.9 points in December, slightly above 50.8 in November and 50.4 in October. Readings above 50 indicate an improvement in business conditions, while those below signal deterioration. According to the bank, this represents the largest increase in private economic activity since February, reflecting the strongest rise in employment in more than two and a half years.
The study indicates that “rising levels of new business and output supported companies’ decisions to hire, acquire more production inputs and, for the first time since last April, increase their inventories.”
However, despite the recovery, the document warns that input cost inflation remained among the highest levels of the year, continuing to place pressure on business operations. The recovery was broad-based across the main sectors of the economy, with particular emphasis on services and wholesale and retail trade, which recorded the largest increases in activity.
Reduction of banks’ reserves at the Bank of Mozambique in the first week of January
This week, it was announced that between 2 and 8 January 2026, the average effective reserve requirement ratio in national currency recorded a cumulative decline of 111 basis points, falling from 32.53% to 31.42%, according to data compiled from the Market Diaries of the Bank of Mozambique.
This change corresponds to a cumulative reduction in liquidity of approximately USD 106.8 million, with average excess liquidity balances decreasing from USD 280.2 million on 2 January to USD 231.5 million on 8 January.
Reserve requirements represent the amounts that commercial banks must keep deposited at the central bank and are a key monetary control instrument. The decline in the effective rate indicates lower fund retention by banks, which may reflect greater demand for liquidity for credit provision or treasury management.
By contrast, the effective reserve requirement ratio in foreign currency showed a slight upward trend over the week, rising from 32.28% to 32.52%, with the liquidity deviation increasing from USD 70.3 million to USD 76.3 million, an increase of USD 6 million.
This weekly behavior of declining reserves occurs in the context of broader adjustments in the financial system. In 2025, according to data released in December, commercial banks’ reserve requirements fell cumulatively by around 29%, reflecting monetary easing measures adopted by the Bank of Mozambique to strengthen liquidity available in the economy.
The trend suggests that financial institutions are seeking greater resource flexibility to meet credit needs and manage liquidity, at a time when the central bank continues to calibrate reserve requirements as part of its monetary policy.
Text: Cleusia Chirindza
