Africa-Press – Angola. This scenario once again raises doubts about the BNA’s interventions in the foreign exchange market, reviving a type of fixed exchange rate regime.
The national currency has been practically stagnant for four months, since it reached the barrier of 912.0 Kwanzas per dollar, since the beginning of December last year it has appreciated by only 0.03% against the US currency, going from 912.3 Kz to the current 912.0 Kz, according to calculations by Expansão based on the exchange rate of the National Bank of Angola (BNA).
This scenario once again raises doubts about the BNA’s interventions in the foreign exchange market, reviving a type of fixed exchange rate regime, since in a free market this stagnation of the exchange rate is not seen as normal in the foreign exchange market.
What defines the value of the national currency is the relationship between supply and demand, but in practice, the exchange rate has not followed market rules, that is, when demand is greater than the supply of dollars, the kwanza depreciates. And vice versa. Thus, after four months, the kwanza has been at a standstill. The national currency only traded above 912.0 Kz on the 21st and 22nd of December when it reached 918.0 Kz per dollar, and then fell to 912.0 the following day. Since then (until this Wednesday), the kwanza has neither appreciated nor depreciated. Despite the fact that over the months the governor of the BNA has stressed that the central bank has not interfered in this
issue, several banking sources contradict this by saying that the banking supervisor “has an invisible hand” that ends up pressuring banks not to make offers that it considers “speculative”, which has prevented the depreciation of the national currency.
Unlike the US dollar, the exchange rate of the kwanza against the euro has fluctuated over the past few months. Since the beginning of the year, the national currency has depreciated 4% against the euro, falling from 942.7 Kz for each 1 euro note to 987.0 Kz this Tuesday (1 April). This is because the European Union currency has been more volatile against the dollar on international markets and the exchange rate in Angola is defined by its relationship with the dollar.
Scenario is not new
The national currency has already been stagnant for seven months at the 820 Kz barrier, between June 2023 and February 2024, after an abrupt depreciation of 39% in 2023. The plunge began on May 12, 2023 and only slowed down from June 28 of the same year, in what was a “hellish” month and a half for the country.
Thus, similar to what happened in 2023, after reaching historic lows, when the exchange rate reached 951.6 Kz per dollar, on October 1, 2024, the kwanza thus stagnates again.
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