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Mozambique’s private sector expanded at its fastest pace in nine months in November, buoyed by a sharp rise in new business and stronger hiring, according to data released by Standard Bank.
The country’s Purchasing Managers’ Index (PMI) climbed to 50.8, up from 50.4 in October—its strongest reading since February 2025. A score above 50 signals improving business conditions, while readings below that threshold indicate contraction.
November’s PMI results revealed a widespread upturn across the economy. All five monitored sectors reported growth in new orders, with firms pointing to stronger customer demand and successful product rollouts as key drivers. Output also increased, marking the fastest expansion since July, supported by the rising volume of incoming work.
New business rose for a second consecutive month and at the quickest rate in nearly a year and a half. To manage the heavier workloads, companies boosted employment at the fastest pace since July 2024—both to add capacity and to fill long-standing vacancies. The increase in staffing helped firms’ clear backlogs for the seventh straight month. Despite the stronger demand environment, businesses continued to carefully manage their inventories, reducing stock levels for the seventh month in a row. Meanwhile, purchasing activity strengthened, and suppliers’ delivery times improved—signs of intensifying competition and better supply chain performance.
Overall input costs rose at the steepest rate in nine months, driven by higher material prices and wage growth. This prompted a modest increase in selling prices, though inflation still remained softer than the long-term survey average. Standard Bank noted that foreign exchange stability, particularly in the USD/MZN exchange rate, continues to help cushion inflation. “The PMI suggests some passthrough from cost increases to higher sales prices,” said Fáusio Mussá, Chief Economist at Standard Bank Mozambique. “For now, USD/MZN stability will likely continue to limit inflationary pressures.”
Despite the headline improvement in business conditions, optimism about the year ahead weakened for the third consecutive month—falling to its lowest point in 2025. Firms, however, still held a generally positive outlook, citing expectations of stronger sales, rising consumer orders, and ongoing improvements in product quality. The dip in sentiment comes as Mozambique grapples with the lingering effects of post-election turbulence, which has pushed the economy into negative growth for three consecutive quarters this year.
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Analysts warn that the potential shutdown of Mozal Aluminum, the nation’s largest industrial employer, could intensify fiscal pressures and strain the currency—factors that would weigh heavily on private sector activity. At the same time, progress on liquefied natural gas (LNG) developments offers a glimmer of hope for a medium-term rebound. “We expect GDP growth to turn positive in the final quarter of 2025 due to favourable base effects,” Mussá explained. “But there is a high risk of contraction from the second quarter of 2026 if Mozal is forced to shut down.”
