Mozambican savings held in time deposits fell in March for the second consecutive month, dropping to 299.830 billion meticais (approximately 4.031 billion euros), official statistical data from the Banco de Moçambique indicates.
According to the central bank, these fixed-term banking deposits had started the year strong at 304.675 billion meticais (4.096 billion euros)—buoyed by a 2.4% expansion compared to December. However, volume contracted by 1.5% over the subsequent two months.
This contraction ends a long period of consistent, progressive monthly growth that began in June 2024 at 264.709 billion meticais (3.559 million euros) and peaked at a record high of 305.871 billion meticais (4.113 billion euros) last July.
Conversely, demand deposits (checking accounts) continue to expand across the financial landscape. They registered a 3% month-on-month increase, climbing to 498.793 billion meticais (6.707 billion euros) in March. This banking landscape includes 15 commercial banks, 12 microbanks, credit cooperatives, and various local savings organizations.
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The benchmark lending rate in Mozambique, known as the prime rate, remained unchanged for May at 15.50%. This pause follows three consecutive cuts earlier this year, as announced today by the Mozambican Association of Banks (AMB).
The prime rate has been on a gradual downward trajectory since January 2024, after spending six consecutive months locked at a record high of 24.1%. The cooling-off period saw the AMB trim 10 basis points in January to bring the rate to 15.70%, hold it steady through February, and apply identical 10-basis-point reductions in both March and April.
The oscillations of the prime rate are directly tied to the central bank’s monetary policy rate (the MIMO rate), which serves as the primary tool to manage domestic inflation.
In tandem with the commercial banking freeze, the Banco de Moçambique kept its policy MIMO rate anchored at 9.25% following its Monetary Policy Committee (CPMO) meeting on Monday. This pause caps a streak of 12 consecutive interest rate cuts implemented since January 2024.
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Central bank governor Rogério Zandamela stated that the hold was a necessary response to a “substantial worsening” of macroeconomic risks and revised upward inflation forecasts. He specifically highlighted potential domestic fallout from supply chain pressures linked to the Middle East conflict, alongside the economic toll of severe flooding triggered by the current rainy season in Mozambique.
