Friday, February 27, 2015

Angola maintains rates as pace of credit rise eases

    Angola's central bank maintained its policy rates, including the benchmark Basic Interest Rate (BNA) at 9.0 percent, citing a slight decline January inflation along with a lower expansion of credit and a 1.27 percent average depreciation in the kwanza's exchange rate in January from December.
    The National Bank of Angola (BNA), which last changed its policy rate in October 2014 when it raised the rate by 25 basis points, noted the annual inflation rate in January declined by 0.04 percentage points to 7.44 percent from December.
    The stock of credit to the economy rose by an annual 14 percent in January to 3.394 billion kwanza, down from an increase of 17.14 percent in December.
    The kwanza started depreciating against the U.S. dollar in September 2014 and has continued to ease this year, like most other currencies. The BNA said the average exchange rate of the kwanza to the dollar amounted to 104.171 in January.
    Today the kwanza was quoted at 106.35 to the dollar, down 3.3 percent this year.
    Angola's Gross Domestic expanded by 4.4 percent in 2014 from 2013 according to preliminary estimates from the BNA, but the oil-dependent economy is expected to slow down this year due to the fall in oil prices.
    Last month Angola'sgovernment slashed $14 billion from planned spending.
    Oil accounts for around half of Angola's economic output, 80 percent of tax revenues and 90 percent of export earnings, according to press reports.

    The National Bank of Angola issued the following statement:

"The Monetary Policy Committee of the National Bank of Angola (CPM) met on February 27, at its forty-first session, the second of the year 2015. 
In order to take monetary policy measures that contribute to the maintenance of price stability in the national economy, the evolution of inflation was analyzed, the real economy, fiscal and monetary accounts as well as the latest information on the international economic situation, including the SADC region. The analysis was based on data for the month of January 2015. I. EVOLUTION OF MONETARY ECONOMICS AND FINANCIAL NATIONAL
  • In January 2015, the monthly inflation rate, as measured by the Consumer Price Index of Luanda was 0.72%, down 0.04 percentage points compared to the same period of 2014. The inflation last twelve months stood at 7.44%, down 0.04 percentage points compared to the previous month; 
  • Class 01 - "Food and Non-Alcoholic Beverages", with 0.20 percentage points, was the largest contributor to inflation in the month, despite its weight in the CPI to be steadily decreasing;  
  • Class 07 - "Transportation" and the Class 12 - "Goods and Services" with 1.59% and 1.46% respectively, were the most varied;
  • In the same period, among the other provinces, the subject of official collection of the general price level, by the Office
  • The LUIBOR Overnight stood at 6.16% per annum and with maturities of 3 and 12 months in 8.29% and 9.75% per year, respectively;    
  • According to preliminary data, the stock of credit to the economy reached a volume of Kz 3,394,000 million, representing a cumulative increase of about 14% in the last 12 months; 
  • In January, commercial banks purchased foreign currency in the USD 1,800 million value in the foreign exchange market, of which USD 1,549 million at the BNA and the rest to their customers. 
  • In the primary foreign exchange market, the average exchange reference rate depreciated by 1.27% from the previous month, having stood at 104.171 kwanzas per dollar of the United States of America.

Based on the analysis of the evolution of the main macroeconomic indicators and their perspective, the Monetary Policy Committee (MPC) decided to keep:  
  • The Basic Interest Rate - Rate BNA - 9% per year;
  • The Interest Rate Standing Facility Liquidity Lending at 9.75% per annum;
  • The Interest Rate Standing Facility Liquidity Absorption at 0% per annum.
The next regular meeting of the Monetary Policy Committee will take place on March 30, 2015 ."


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