"We are hopeful that the situation will improve in the short term", he stated, at a press conference, in Sumbe (Kuanza Sul), after the meeting of the Monetary Policy Committee (CPM), in which the BNA decided to keep its interest rates unchanged. I swear directors.
Factors such as the reduction of VAT on food and the relative stability of the exchange rate will contribute to improving the situation, he said, highlighting that the currency (kwanza) has been stable in the last 77 days, which should have "a positive impact " in price behavior.
In addition to the BNA rate, which remained at 17 percent, the interest rate on the permanent liquidity-providing facility remained unchanged, at 17.5 percent, and the interest rate on the pressing liquidity absorption facility, at 13. 5 percent.
The BNA governor justified the decision to maintain interest rates with the fact that the Monetary Policy Committee considered that the price increase observed in August "was due to seasonal factors and the insufficient supply of goods and services in a context in which domestic demand remained repressed and the exchange rate remained relatively stable".
He also contributed to this decision by "the assumption that the behavior of inflation will continue to be determined fundamentally by seasonal factors and imbalances between demand and supply", but also by the reduction in diesel subsidies.
Therefore, he responded to journalists, it was expected that there would be an inflection in the behavior of prices in the months of July and August, despite pointing out "some phenomena that end up (...) surprising", such as the rise in registration prices and registrations before September, when the diploma relating to price adjustment was published.
Inflation in Angola maintained the upward trend started in May in August, accelerating to 13.54 percent in year-on-year terms and 2.04 percent in monthly terms, mainly due to the rise in prices in the items of education, food and transport.
"What can be seen is that August's inflation was influenced by a very limited number of products", that is, 24 products in a set of 732 goods and services in the "basket" used for statistics, he added.
Manuel Tiago Dias expressed concerns about the dynamics of the world economy, "which has been showing increasing signs of slowing down, reflected in data for the second quarter of 2023", as well as the less than encouraging prospects for the Chinese and Eurozone economies.
Internally, in the monetary domain, the monetary base recorded a contraction of 0.13 percent in monthly terms and 8.75 percent year-on-year, while the monetary aggregate M2 (national currency) expanded by 3.72 percent.
The surplus balance of the goods account stood at 12,665 million dollars in the first eight months, against 24,490 million dollars recorded in the same period of the previous year, that is, a reduction of around 48 percent, reflecting a reduction of 26 percent in exports.
The stock of international reserves stood at 14 billion dollars at the end of August, covering 7.5 months of imports.
The next CPM meeting takes place in Luanda on the 20th and 21st of November.