The National Bank of Angola held the key interest rate at 19.5% for ten months while lowering the liquidity absorption rate and reserve requirements to enhance economic growth and liquidity. GDP is expected to grow at 4.4% in 2024, and inflation is anticipated to decline to 17.5% in 2025.
The National Bank of Angola has decided to maintain its key interest rate at 19.5% during the March 2025 meeting, continuing a consistent rate for ten months. This figure represents the highest borrowing cost since December 2022. In a strategic move to enhance liquidity, the central bank has reduced the liquidity absorption rate by 100 basis points to 17.5% and the reserve requirement ratio for commercial banks by the same margin to 20%.
These adjustments aim to bolster liquidity within the Angolan financial system, facilitating economic growth that is projected to remain above the target of 3%. For 2024, GDP growth is anticipated at 4.4%, exceeding the 3.61% growth rate in the oil sector. Furthermore, inflation is expected to decrease to 17.5% in 2025, down from a projected 27.5% by the end of 2024.
The National Bank of Angola’s decision to maintain the key interest rate at 19.5% while lowering reserve requirements is designed to enhance liquidity and stimulate economic growth. With GDP growth projected at 4.4% and inflation expected to decline, these measures reflect the central bank’s commitment to fostering stability in the financial system and the broader economy.
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