Angola's c.bank plans further kwanza devaluations: sources

By Joe Brock JOHANNESBURG (Reuters) - Angola's central bank is planning to further devalue the kwanza this year and will continue a managed currency slide in 2016, two banking sources said on Thursday, as Africa's second-biggest oil exporter struggles with lower crude prices. The kwanza traded officially at around 135 against the U.S. dollar on Thursday but changed hands at around 250 per dollar on the black market. Angola's central bank devalued the kwanza by about 4 percent and tightened U.S. dollar liquidity in September after a devaluation of 6 percent in June, but the currency has continued its decline on the secondary market. "The central bank is planning to devalue the currency again this year and then gradually keep devaluing until the official rate is closer to the parallel market," one banking source said. The central bank was not immediately available for comment. Some economists believe Angola should sharply devalue the currency but the central bank would prefer to take gradual steps in case there is a rebound in global oil prices which would boost foreign exchange reserves, the sources said. A year of subdued oil prices has hammered sub-Saharan Africa's third-largest economy, which relies on crude exports for around 95 percent of foreign exchange earnings. Cobus de Hart, an economist at NKC African Economic, forecasts the kwanza will end this year on the official market at 145 against the dollar after another devaluation this year. "It now seems that the central bank prefers to keep liquidity fairly tight, which should contribute to the kwanza remaining relatively stable between devaluations," de Hart told Reuters.

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