Angola maintains rate on lower inflation, credit expansion

    Angola's central bank maintained its Basic Interest Rate (BNA) at 9.0 percent, citing a slight decline in December inflation, annual credit expansion of 17.14 percent and an average depreciation of the kwanza's exchange rate by 1.36 percent from the previous month.
   The National Bank of Angola last changed its policy rate in October when it raised it by 25 basis points.
    Angola's consumer price inflation rate was 7.48 percent in December, down from 7.49 percent in November but unchanged from October.

    The National Bank of Angola issued the following statement:

"The Monetary Policy Committee of the National Bank of Angola (CPM) met on February 2, at its forty regular meeting, the first 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 December 2014. 

I. EVOLUTION OF MONETARY ECONOMICS AND FINANCIAL NATIONAL

• In December, the monthly inflation rate, measured by the Consumer Price Index of Luanda was 0.73%, down 0.02 percentage points from the same period of 2013. Inflation in the last twelve months stood themselves in 7.48%, down 0.01 percentage points compared to the previous month.   

• Class 01 - "Food and Non-Alcoholic Beverages", with 0.27 percentage points, was the largest contributor to inflation in the month; 

• Class 12 - "Miscellaneous Goods and Services", with 1.36%, was the most varied in the city of Luanda;

•  In the same period, among the other provinces, the subject of official collection of the general price level, by the National Statistics Institute, the province of Cabinda recorded the lowest inflation rate, ie 0.10% ;

• The LUIBOR Overnight stood at 5.39% per annum and with maturities of 3 and 12 months in 8.22% and 9.95% per annum, respectively;    

•  According to preliminary data, credit to the economy reached a volume of Kz 3,428,000 million, representing an increase of 17.14% over the last 12 months.

• In December, commercial banks purchased foreign exchange in the amount of USD 2,092 million in the foreign exchange market, of which USD 1,783 million at the BNA and the rest to their customers. 

• In the primary foreign exchange market, the average exchange reference rate depreciated by 1.36% from the previous month, having stood at 102.863 kwanzas per dollar of the United States of America.

II. MONETARY POLICY COMMITTEE DECISIONS

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 1.75% per annum.

The Monetary Policy Committee will meet extraordinarily to evaluate the course of monetary policy, after review by the Executive, the macroeconomic management tools."

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