Good afternoon. The Bank of Mozambique’s decision yesterday to cut its policy interest rate, from 16.5% to 15.75%, was already trailed by the central bank and is not expected to be the last such cut this year. The International Monetary Fund had said last year that now would be a good time for the bank to reduce interest rates, considering low inflation (4% year-on-year in February) and weak economic growth outside the mining and gas sectors. According to economists at Standard Bank, who produce the most authoritative briefings on the state of the Mozambican economy, inflation is expected to fall further this year, before rising towards the end, but remaining within single digits. Standard Bank expects another 0.5 percentage point cut this year.
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