Angola’s central bank hikes benchmark interest rate to 11.00% in December

Luanda, Angola, Capital Markets in Africa — National Bank of Angola (BNA, Banco Nacional de Angola) Monetary Policy Committee (CPM) held a meeting on 21 December 2015, its 51st ordinary session and decided to increase the Basis Interest Rate to 11.00% from 10.50%, to maintain price stability, and taking into account the economic outlook.

Furthermore, the CPM increase the Marginal Lending Rate from 12.5% to 13% but reduce the Overnight Liquidity Absorbing Rate from 1.75% to 0% per year.  In addition, the central bank decided to set up a permanent liquidity facility with a seven-day maturity, having set the interest rate at 1.75 percent.

In the brief press release, BNA commented that in November the inflation rate reached 1.33% lower than October (1.35%). While the accumulated inflation up to November 2015 reached around 12.47%, a major increase when compared to the 6.69% posted in the same period in 2014.  

The BNA went further to say, the gross international reserves increased from US$23.66413 billion to US$25.09017 billion, representing a monthly increase of 6.03%. Also, the average Kwanza reference exchange rate in relation to the US$ stood at 135.312 Kwanzas at the end of November 2015. In November the Luibor (Luanda Interbank Offered Rate) stood at 11.53% “overnight” and at 11.56% and 12.00% for maturities of three and 12 months, respectively.

The committee said in a statement it had noted the worsening of monetary conditions in the Angolan economy, after analyzing the evolution of inflation and the exchange rate, as well as fiscal, monetary and external account indicators.