The benchmark interest rate of the Angolan market, the BNA rate, was raised by two percentage points, from 16% to 18%, a decision intended to curb consumer price increases in the country, according to the latest decisions of the Monetary Policy Committee (CPM) of the National Bank of Angola.
The CPM also decided to keep the rate of the marginal lending facility (“overnight”) at 20% per year and reduce the liquidity absorption rate to 0% per year, and will now intervene using open market operations in order to regulate liquidity.
It further decided to put an end to the obligation of commercial banks to set up national currency reserves in order to buy foreign currency from the central bank, as well as putting an end to the obligation of the customers of commercial banks to set up reserves as a precondition for the purchase of foreign currency.
The CPM decided to reduce from 30% to 21%, the coefficient of obligatory reserves to be applied to deposits of customers of commercial banks, in national currency and keep the coefficient for the accounts of central and local governments and municipal administrations unchanged.
All these decisions were made in order to reverse inflation, “taking into account the high levels of accumulated inflation,” said a statement issued by the Angolan central bank.
Citing data from the National Institute of Statistics (INE), the central bank’s statement said inflation for the last 12 months stood in October at 28.96%, against 27.46% in the previous month and 40.04% in the same month of 2016. (macauhub)