Angola Keeps Benchmark Interest Rate at 17%

Angola Keeps Benchmark Interest Rate at 17%

In a bid to stem further monetary policy tightening to support economic growth, the National Bank of Angola kept its benchmark interest rate unchanged at 17% during its July meeting amidst high inflation rate concerns.

The apex bank in the country maintained borrowing costs at the lowest level since mid-2021, as policymakers navigate the balance between supporting the economy and addressing concerns about high inflation.

According to the outcome of its policy meeting, the central bank has however revised its inflation forecast upward to a range of 12% to 14% by the end of the year, primarily due to the depreciation of the kwanza.

Recall that its latest consumer price index reading saw the inflation rate rising. In June, the statistics office said Angola’s headline inflation picked up to 11.25%, the highest level in four months, following the removal of fuel subsidies.

Meanwhile, the country’s economic growth significantly slowed to 0.3% in the first quarter of fiscal year 2023, due to a sharp contraction in the oil sector performance.

Angola’s new central bank governor, Dias, stated that he expects the country’s oil production to stabilize, anticipating no major changes in crude prices, while he also expressed a commitment to implementing measures that would prevent significant currency fluctuations.

Elsewhere, Angola’s rice imports are forecast to fall by 14% in 2024 with tariffs on certain Indian white rice continuing to subdue demand, the U.S Agriculture Department said late Wednesday.

Imports in 2024 were revised to 600,000 metric tons in July from 700,000 tons forecast in June, the USDA said in its Grain: World Markets and Trade report.

In the current year, rice imports are forecast to fall by 23% to 500,000 tons from 650,000 tons projected in June, due to reduced trade, it said.

Rice production in Angola is estimated at around 50,000 tons annually, according to the country’s national rice development strategy of 2018-2022. Rice is one of the most consumed cereals in Angola, after corn. #Angola Keeps Benchmark Interest Rate at 17%#

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