"We anticipate that the average exchange rate for the kwanza will depreciate by over 10 percent this year when compared to last year, which will put pressure on consumer prices due to Angola's heavy dependence on imported goods," write the analysts from the African branch of British consultancy Oxford Economics.
In a commentary on the evolution of the kwanza, NKC says that "the forecast for the average inflation rate in 2021 is 22.4 percent, slightly above the rate of 22.3 percent recorded last year.
Rising oil prices, in line with rising demand, will benefit the second largest oil producer in sub-Saharan Africa, but Angola's currency, they warn, "will remain vulnerable due to the fragile economic recovery and uncertain global demand due to covid-19 infections in more developed countries."
Prices in Angola have risen 24.82 percent over the past 12 months, according to the latest data from the National Statistics Institute (INE), released in mid-May, after seeing a 2.09 percent increase in prices between March and April.
"The year-on-year change stands at 24.82 percent, registering an increase of 4.01 percentage points with respect to that observed in the same period of the previous year," says the National Consumer Price Index (IPCN).
The same document points out that prices also increased 2.09 percent between March and April.
The figure recorded in April this year represents an increase of 0.31 percentage points compared to the previous month and, in year-on-year terms, of 0.04 percentage points compared to the 2.05 percent recorded in the same period last year.
Already since the beginning of the year, inflation in Angola totals 7.65 percent, a figure similar to that recorded in the first four months of 2020, when it reached 7.89 percent. In relation to 2019, this represents an increase of 3.25 percentage points from the 4.40 percent recorded then.
In the proposal for the General State Budget for 2021, Luanda estimated an annual accumulated inflation rate of 18.27 percent for this year.
