Angola: Bank of Angola held Basic Interest Rate steady at record high in October
November 3, 2016
At its 31 October monetary policy meeting, the National Bank of Angola (Banco Nacional de Angola, BNA) decided to keep the Basic Interest Rate on hold at a record high of 16.00%. The Central Bank has raised the Basic Interest Rate three times since the beginning of the year in an effort to combat spiraling inflation; the latest hike was in June. Inflation has been soaring due to successive reductions in fuel subsidies and the weakness of the Angolan kwanza against the U.S. dollar, which is dramatically increasing the cost of imports to the African country.
In its brief press release, the BNA stated that its decision to leave the rate unchanged was based on the latest evolution of prices, the exchange rate and other macroeconomic indicators, as well as the global economy. According to preliminary data, credit growth was 0.8% in September in the whole economy, whereas credit to central government grew 1.8% in the period. The Central Bank stated that data from September showed that the monthly variation in consumer prices eased from 3.31% in August to 2.14% in September, though the annual inflation in consumer prices continues to exceed 30.0%.
The next monetary policy meeting is scheduled for 28 November.
Author: Andrea Vetrugno, Economist