Mozambique: Commercial Banks' Minimum Reserves Reach 308.9 Billion Meticais

In Mozambique, the Central Bank (Banco de Moçambique) imposes minimum reserves on commercial banks, a classic monetary policy tool aimed at containing inflation and stabilizing the metical, in a country marked by the memory of the 2016 hidden debt crisis and its growing dependence on natural gas revenues from Cabo Delgado. According to data reported by the AIM agency and relayed by AllAfrica, the minimum reserves held by Mozambican commercial banks reached 308.9 billion meticais in May, or approximately 4.8 billion US dollars at the current exchange rate, corresponding to a ratio close to 31%. Such a level, among the highest in the region, means that banks are locking up a very significant share of collected deposits, correspondingly reducing the liquidity available to finance Mozambican businesses and households. For savers and borrowers, this can translate into scarcer or more expensive credit. This restrictive policy reflects a classic trade-off: prioritizing monetary stability and inflation control at the expense of financing the real economy. Lacking comparative data for previous months in the source dispatch, it remains an open question whether this level marks a recent intensification of monetary tightening or simply long-term stability.