Circular No. 01/EMO/2019, March 6 – Amendment to Circular No. 02/EMO/2018 on the Reserve Requirement Incidence Rate

Bank of Mozambique Administration

MONETARY STABILITY DEPARTMENT CIRCULAR NO. 01/EMO/2019 Maputo, March 6, 2019

SUBJECT: Amendment to Circular No. 02/EMO/2018, of August 31, on the Reserve Requirement Incidence Rate

The Monetary Policy Committee (MPC) of the Bank of Mozambique, meeting in its Extraordinary Session on March 6, 2019, resolved to increase the reserve requirement (RR) coefficient for foreign currency liabilities by 900 basis points and maintain the reserve requirement coefficient for national currency liabilities.

In these terms, under Article 6 of Notice No. 12/GBM/2017, of June 9, the Bank of Mozambique determines:

1. The incidence rate for reserve requirements applicable to the national currency incidence base remains at 14.00%.

2. The incidence rate for reserve requirements applicable to the foreign currency incidence base is set at 36.00%.

3. This Circular enters into force immediately and takes effect from the reserve requirement consolidation period beginning on March 7, 2019.

4. This Circular revokes Circular No. 02/EMO/2018, of August 31, and all provisions contrary thereto.

Any doubts arising from the interpretation and application of this Circular shall be submitted to the Markets and Reserve Management Department of the Bank of Mozambique.

BANK OF MOZAMBIQUE Stability Department Felisberto Dinis Navalha Administrator