National Bank of Angola Cuts the Required Reserve Ratio


During the meeting held on June 28th, The National Bank of Angola left its benchmark interest rate unchanged at 10 percent for the sixth consecutive month. Yet, in order to reduce the cost of credit, the Monetary Committee decided to reduce the required reserve ratio on commercial bank deposits in local currency by 500 bps to 15 percent.

The bank lowered the base rate by 0.25 percentage point in January, the second cut since it was introduced in October 2011.

In setting up the right monetary policy, the Monetary Committee took into consideration economic situation, inflation rate and fiscal and monetary accounts. 

In May, the inflation rate increased to 0.87 percent mom, up from 0.60 percent in the previous month. Recreation and culture costs recorded the highest increase, up by 1.39 percent. The annual inflation rate also increased to 9.25 percent, from 9 percent in April.

At the end of May, the average exchange rate was 96.168 Kwanzas to the US dollar, up from 96.045 at the end of the previous month.

In May, loans to the private sector expanded by 1.54 percent, up from 0.18 percent in April. In the same period, the volume of foreign exchange sold to the market by the bank amounted to USD 1800 million, bringing the volume for the first five months of the year to USD 7982 million.

Considering the reserve requirements of national and foreign currency, the Monetary Committee decided to reduce the reserve requirements on commercial bank deposits in local currency from 20 percent to 15 percent. 

National Bank of Angola Cuts the Required Reserve Ratio


Joana Taborda | joana.taborda@tradingeconomics.com
6/28/2013 7:45:19 PM