A technical assistance mission from the IMF visited Angola in May 2024 at the request of the Banco Nacional de Angola. The mission reviewed the country’s forecasting and policy analysis system, recommending enhancements for inflation targeting. While progress has been made, further improvement is necessary to fully meet the inflation management objectives and strengthen policy analysis capabilities.
In response to a request from the Banco Nacional de Angola (BNA), a technical assistance mission from the International Monetary Fund’s (IMF) Monetary and Capital Markets Department visited Luanda, Angola, between May 20 and May 24, 2024. The mission’s primary objective was to evaluate the country’s forecasting and policy analysis system (FPAS) and provide recommendations to enhance its modeling and forecasting capabilities. By integrating fiscal channels into the main forecasting model, the team aimed to better articulate the dynamics of the Angolan economy.
The mission acknowledged the significant progress BNA has achieved in enhancing its FPAS over recent years. However, they noted that the existing framework still only partially fulfills the requirements necessary for effective inflation targeting. The technical assistance team proposed several measures to facilitate a transition to complete inflation targeting and strengthen the BNA’s analytical capacities.
Additionally, the IMF team emphasized that further advancements are crucial in utilizing FPAS models for accurate economic forecasting, policymaking guidance, and improving communication regarding monetary policy. They highlighted the need for ongoing development in the system to meet the evolving challenges of inflation management and economic stability.
The IMF’s technical assistance mission plays a vital role in aiding Angola’s transition to effective inflation targeting. With notable progress already made by the BNA, the recommended enhancements to the FPAS and the introduction of fiscal aspects will advance the country’s economic forecasting capabilities. Continuous improvement in these systems is essential for achieving better monetary policy outcomes and communication strategies.
Original Source: www.imf.org
