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Rate cut gives boost to business

Yesterday’s interest rate cut is unlikely to be the last this year

Today’s front pages in Maputo. Photo © Faizal Chauque / Zitamar News

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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From the Zitamar Live Blog:

Zitamar Mozambique Live Blog
Today’s front pages in Maputo. O Pais leads with the Bank of Mozambique reducing interest rates from 16.5% to 15.75%. Other headlines cover the health workers’ union suspending strike action, and opposition party Renamo leader Ossufo Momade accusing the government of a lacklustre response to recent flooding. Notícias leads with Mozambique’s membership in the African Medicines Agency allowing the country to quickly access drugs. Other articles cover the prime minister’s advocacy for sustainable resource production, and a flooding risk in central and northern Mozambique given forecasts for heavy rains in the coming days. Weekly Savana’s lead headline “War declared” refers to differences between the Southern African Development Community and Rwanda, while below a headline says recent flooding in Maputo has revived memories of severe flooding in the year 2000. Sign up to the Zitamar Daily Briefing for an in-depth look at the biggest stories in the Mozambican media on weekdays 📷 Faizal Chauque / Zitamar News

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