Morocco’s central bank leaves key rate at 2.5%, cuts GDP growth forecast for 2015 to 4.6%

By bne IntelliNews September 23, 2015

Morocco’s central bank maintained its benchmark interest rate unchanged at 2.5%, underscoring the subdued medium-term CPI inflation outlook at 1.8% in 2015 and an average of 1.5% price growth over the next six quarters. The c-bank also noted the improving external position amid narrowing CA gap on smaller trade deficit due to falling imports and rising exports. The c-bank also expects improvement in economic activity and bank lending.

The central bank remains upbeat on the 2015 GDP outlook despite cutting this year’s economic growth projection to 4.6% from the previous 5.0%. The 2015 GDP growth will, however, accelerate from last year’s 2.4%.  Growth will be supported by strong agriculture output that will mitigate the still subdued non-agro growth at 3.3% in 2015. In 2016, Morocco’s GDP growth will brake to 2.4% on cooling agriculture output, according to the central bank.

The central bank was also upbeat on the external sector amid narrowing trade deficit (down 20.4% y/y at end-August) on rising exports and dropping imports. The favourable trade balance parameters coupled with revenues from grants of GCC countries (MAD6bn) and assuming an average oil price of $57 a barrel, will cut current account (CA) deficit to about 2.8% of GDP in 2015, from 5.9% in 2015, the central bank forecasts.

Such positive indicators, coupled with a 23% annual hike in net FDI to MAD 24.2bn at end-August will also help lift FX reserves. The latter totalled MAD210bn at end-August covering around 6 months of imports, the central bank said.

Related Articles

Erdogan: Turkey may strike Kurdish militants in Iraq’s Quandil Mountains “at any moment one evening”

Turkey will strike Kurdish militant camps in the mountains of northern Iraq if Baghdad does not itself clear the area of militants, President Recept Tayyip Erdogan said on June 7. On June 6, ... more

UAE investor to develop $500mn agri-food group in Romania

The Al Dahra Group of the United Arab Emirates (UAE) wants to purchase nearly 60,000 hectares of agricultural land along the Danube River, develop a logistics company including water and road ... more

UAE to buy major stakes in Kazakh special economic zones

The United Arab Emirates’ (UAE’s) global port operator Dubai Ports World on March 24 signed two framework agreements to acquire stakes in Kazakhstan’s two Special Economic ... more

Dismiss