[Mozambique has been the darling of the Western world, and investors in Southern Africa in the last few years. They’ve pumped billions of dollars into a previously completely dead economy. But look at this. Is the “Mozambique Dream” fading? Jan]

Mozambique’s rate of inflation is worsening, according to the latest bulletin issued by the Bank of Mozambique.

Inflation, as measured by the Maputo Consumer Price Index, was 2.51 per cent in February, which compares with 1,79 per cent in January. Annual inflation rose from 11.51 per cent in January to 15.25 per cent in February.

The faster pace of inflation in February was due mainly to rises in the price of electricity, bread, groundnuts and certain green vegetables (cabbage and lettuce). Falls in the price of some other foodstuffs (tomatoes and live chickens) were not sufficient to offset this.

The central bank reported that, in the first half of March, the exchange rate of the Mozambican currency, the metical, was fairly stable. Thus on 15 March, the average quotation was 26,876 meticais to the US dollar – which was a slight improvement (of 0.2 per cent) in the metical’s position, compared with the exchange rate of 28 February.

The metical also appreciated by 0.4 per cent against the South African rand, but fell by 1.2 per cent against the euro.

The bulletin also pointed to a seven per cent increase in the world market price of oil in the first fortnight of March, blamed on unrest in Nigeria, and the crisis over Iran’s nuclear programme.

But, on a happier note, the price of aluminum, Mozambique’s most important export, rose by 2.7 per cent, which will bring a welcome improvement to the balance of payments.

Source: AllAfrica.Com
URL: http://allafrica.com/stories/200603270411.htm…/p>