Required reserves in kwanzas in Angola will increase to 15 pct

14 November 2014

The government of Angola plans to increase the reserve requirements in national currency to 15 percent, returning to 2013 levels, based on the current macroeconomic climate, according to a statement from the Economic Committee of the Council of Ministers.

Required reserves or minimum cash requirements are part of the deposits made by customers in commercial banks that must be deposited at the central bank, and are intended to reduce the power that those banks have to multiply the money supply through loans.

According to the statement issued after the meeting held Wednesday, the proposal now under consideration increases from required reserves from 12.5 percent ​​to 15 percent almost a year after the reverse decision, implemented by the National Bank of Angola.

Last January, the Angolan central bank, through the Monetary Policy Committee, said the decision to drop these reserves was in order to “increase the financial resources available for lending to the economy” and “to continue to influence a reduction of costs of financial intermediation. ”

At the time the reserve requirements in foreign currency remained unchanged at 15 percent. (macauhub/AO)