Central Bank holds fire in January

Central Bank stands pat for third meeting in a row: On 20–21 January, the Monetary Policy Committee of the National Bank of Angola (BNA) decided to leave the key interest rate at 19.50%. The decision marked the fourth consecutive hold since July. Meanwhile, the Bank cut the reserves requirement rate by 100 basis points to 20.00%.

Sticky inflation and sturdy growth drive decision: The BNA opted to maintain a tight monetary policy stance in order to combat elevated price pressures: Inflation slowed to 27.5% in December, broadly in line with the Central Bank’s 27.0% end-2024 forecast but still far above most of its regional counterparts. The Bank noted a variety of factors driving inflation last year, among them the pairing-back of fuel subsidies, which should continue to fuel price growth this year. Meanwhile, the BNA highlighted that the economy accelerated in Q3 and should have expanded at a robust rate in Q4, buoyed by both the hydrocarbons and non-oil sectors; this likely gave the Bank scope to keep interest rates elevated.

Loosening cycle on the horizon despite upside risks: In its communiqué, the BNA did not provide specific forward guidance. Our panel anticipates inflation to slow in 2025 as a whole but to outpace the BNA’s end-2025 forecast of 17.5%. As such, risks to the policy rate are skewed to the upside. Still, most of our panelists expect the Bank to embark on a loosening cycle this year, delivering around 100 basis point cuts by end-2025. The Bank will reconvene on 17–18 March.

How should you choose a forecaster if some are too optimistic while others are too pessimistic? FocusEconomics collects Angolan interest rate projections for the next ten years from a panel of 6 analysts at the leading national, regional and global forecast institutions. These projections are then validated by our in-house team of economists and data analysts and averaged to provide one Consensus Forecast you can rely on for each indicator. By averaging all forecasts, upside and downside forecasting errors tend to cancel each other out, leading to the most reliable interest rate forecast available for Angolan interest rate.

Download one of our sample reports to visualize what a Consensus Forecast is and see our Angolan interest rate projections.

Want to get access to the full dataset of Angolan interest rate forecasts? Send an email to info@focus-economics.com.