Angola’s Central Bank Raises Inflation Expectations Due to Currency Depreciation

By Xinhua 

July 16, 2023

The Monetary Policy Committee with the National Bank of Angola (BNA), the country’s central bank, announced Friday in a statement that it had revised the inflation rate forecasts to the range of 12 percent to 14 percent upwards, “essentially due to the recent depreciation of the national currency.”

In the statement issued on the website of the BNA, the Monetary Policy Committee mentioned that at the end of June, Angola’s international reserves stood at 13.68 billion U.S. dollars, representing 6.01 months of import cover of goods and services.

The Monetary Policy Committee decided to maintain the central bank’s benchmark rate at 17 percent.

“The decision is based on the resurgence of inflationary pressures due to changes in the macroeconomic framework, particularly the reduction in export revenues and the consequent currency devaluation. Additionally, expectations surrounding the reduction of gasoline price subsidies and constraints resulting from the reorganization of street vending also impacted prices,” read the statement.

In the monetary field, Angola’s M2 monetary aggregate in the national currency contracted 2.36 percent in June, reducing the accumulated variation since the beginning of the year to 3.17 percent and the year-on-year variation to 6.57 percent, according to the statement.