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Angola's central bank left its basic interest rate (BNA) at 18.0 percent and said it had sold 735.94 million euros to commercial banks in March, pushing up total sales this year to 2.246 billion from 1.510 billion in February.


After years of foreign currency shortage, the National Bank of Angola (BNA) in January switched to a floating exchange rate regime with bands from a fixed exchange rate system, and began auctions of foreign currency to determine a reference rate.


The BNA's monetary policy committee said the difference between the exchange rate of the kwanza against the euro between Jan. 9, when a new foreign currency regime was adopted, and March 30 had narrowed to 83.72 percent from 101.19 percent.

The combined impact of higher oil exports and prices helped the trade balance rise to US$2.67 billion in March, up from $2.01 billion in February, and pushed up the level of international reserves by 1.26 percent to $17.69 billion from February, the equivalent of 7.37 months of imports.


The adoption of a new exchange rate regime in January led to an immediate plunge in the value of the kwanza, which has continued to depreciate since then. Today the kwanza was trading at 273 to the euro, down just over 27 percent since Jan. 8, the day before the switch in exchange rate regime.


Against the U.S. dollar the kwanza was trading at 225.9, down 26.5 percent since Jan. 8.


Angola's inflation rate has been declining steadily since hitting 41.12 percent in December 2016 and fell to 20.9 percent in March from 21.47 percent in February.


The country's monetary base, which is now a monetary policy variable, grew by 4.56 percent in March for an annual increase of 15.09 percent. Credit issued in kwanza, especially to the production and distribution of electricity, gas, water and education, rose 0.33 percent in March for an annual rise of around 9.50 percent, BNA said.

 

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