Oxford Consultancy Predicts Inflation to Rise in Mozambique due to Likely Devaluation

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Oxford Economics states that although consumer prices surged in early 2025 because of violent public unrest that disrupted economic activity, inflation is expected to slow in the rest of the year.

British consultancy Oxford Economics said that inflation in Mozambique will average 4.4% in 2025, and predicted that there will be a “sharp increase” next year due to the likely devaluation of the metical.

The consultancy said that the public debt is rising and the currency is overvalued. It expects market forces to press the Mozambican authorities to devalue the currency in 2026, leading to a sharp rise in inflation in 2026. The slight increase in the general price level to 4.15% is in line with the forecast of 4.4% for the total for this year, according to analysts from the African department of this British consultancy.

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Oxford Economics states that although consumer prices surged in early 2025 because of violent public unrest that disrupted economic activity, inflation is expected to slow in the rest of the year.  The Consumer Price Index (CPI) for June from the National Statistics Institute (INE) recorded a year-on-year price increase in June of 4.15% (4.0% at the end of May and 3.99% in April), The food and non-alcoholic beverages divisions, along with restaurants, hotels, cafés and similar establishments, increased by 9.38% and 8.53% in one year, respectively, and they mainly drove this influence.