Angola's kwanza weakens further against dollar

LUANDA, Nov 26 (Reuters) - Angola's kwanza extended its losses against the U.S. dollar at an auction on Wednesday, trading at 88.17 to the greenback compared to 87.69 at a previous auction, the central bank said on Thursday.

Banco Nacional de Angola has been increasing the amount of dollars it sells to local banks in a bid to strengthen the kwanza. In October it sold $1.4 billion dollars to banks, up from $583 million the previous month.

The bank holds auctions on Mondays, Wednesdays and Fridays and the results of the auction are announced a day afterwards.

The increase in dollar sales has taken a toll on the country's foreign exchange reserves, which fell for the first time in three months in October to $12.1 billion from $12.8 billion in September.

The kwanza has lost 17.5 percent of its value this year on lower oil revenues and a government decision to loosen the currency's peg to the dollar last month. The kwanza is even weaker on the parallel market, at around 93/dollar.

Angola rivals Nigeria as Africa's biggest oil producer and depends on oil exports for almost 90 percent of its foreign exchange reserves.

(Reporting by Henrique Almeida, Editing by Toby Chopra) (For more Africa cover visit: http://af.reuters.com -- To comment on this story email: [e-mail]) Keywords: ANGOLA KWANZA/ (Reuters messaging: [e-mail]; email: [e-mail]; tel [phone]) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.