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

Ankara and Tehran join wave of anger directed at Trump’s recognition of Jerusalem as Israel’s capital

US President Donald Trump's December 6 announcement that his administration has decided to unilaterally recognise Jerusalem as Israel's capital was described as “against international law” by ... more

Islamic State is finished declares Iran's President Rouhani

Iranian President Hassan Rouhani on November 21 declared the end of the so-called Islamic State militant and terrorist group following decisive battles in Iraq and Syria. Stating that he wished to ... more

Turkey the loser as Baghdad rewards Iran with control of Kurdish oil exports

Iran is taking control of oil exports from Iraqi Kurdistan's giant Kirkuk field with Baghdad authorising the move as a reward for the Iranians' help in quelling the Kurds' late September push for ... more

Dismiss