The Board of Bank Al-Maghrib (BAM) decided to reduce the key rate by 25 basis points to 2.5%.
BAM also announced, in a press release sanctioning its last Council meeting of 2024, that it will continue to monitor developments in the situation very closely and will base its decisions meeting by meeting on the basis of the most up-to-date data.
The Central Bank also reported moderate inflation in the medium term, standing, according to BAM projections, at 2.4% in 2025 and 1.8% in 2026.
For its part, economic growth should be limited to 2.6% in 2024, before accelerating to 3.9% over the next two years.
Concerning foreign trade, after virtual stagnation in 2023, exports of goods should experience a gradual acceleration, with a rate expected to increase from 5.5% this year to 8.9% in 2026.
This improvement would essentially reflect the continued dynamic of sales in the automotive sector which should reach 200 billion dirhams (billion dirhams) in 2026 and the recovery of those of phosphate and derivatives which would be around 100 billion dirhams the same year.
Likewise, after a decline of 2.9%, imports would increase by 4.6% in 2024, by 7.9% in 2025 and by 6% in 2026, a result in particular of the expected increase in acquisitions of goods of equipment linked to the implementation of numerous infrastructure projects.
For its part, with the decrease in international oil prices, the energy bill is expected to fall by 6.9% this year, stabilize in 2025 and fall by 4.1% in 2026 to nearly 110 billion dirhams.
At the same time, travel receipts should maintain their good performance, ending the year with an increase of 9.1% and should continue to improve to reach 128 billion dirhams in 2026.
Regarding transfers from Moroccans living abroad (MRE), they would increase by 4.3% at the end of this year and then increase at an annual rate of between 3% and 3.5% to reach around 128 billion dirhams in 2026. .
In view of these developments, the current account deficit would remain contained, standing at the equivalent of 1% of GDP in 2024 and below 2% of GDP over the next two years. In terms of the financial account, receipts from foreign direct investments would improve, going from the equivalent of 2.7% of GDP in 2024 to 3.3% in 2026.
In total, and taking into account planned external financing from the Treasury, BAM’s official reserve assets would gradually strengthen to stand at MAD 400.2 billion at the end of 2026, representing nearly 5 months and 8 days of imports of goods and services.
In terms of monetary conditions, the need for bank liquidity, driven mainly by the expansion of fiat currency, would continue to grow to reach MAD 192.3 billion in 2026. Taking into account the expected evolution of economic activity and the expectations of the banking system, the rate of growth of credit to the non-financial sector should gradually accelerate, from 3.8% in 2024 to 5.5% in 2026.
Concerning the effective exchange rate, it should continue its slight appreciation in real terms with a rate of 0.5% in 2024 and 0.3% in 2025, mainly due to the appreciation of its value in nominal terms, before a decrease of 0.6% in 2026.
On the public finance side, budget execution for the first ten months of 2024 shows an improvement of 13.6% in ordinary revenues, driven in particular by the notable performance of tax revenues. Overall spending increased by 7.4%, reflecting in particular the increase in spending on goods and services and investment.
In view of these achievements, the data from the 2025 Finance Law and the three-year budget programming 2025-2027, as well as the new macroeconomic projections from BAM, the budget deficit, excluding proceeds from the sale of State participations, should be be at 4.5% of GDP in 2024, before gradually decreasing to 4.2% of GDP in 2025, then to 3.9% in 2026.
The Board approved the Bank’s budget for the 2025 financial year, validated the foreign exchange reserve management strategy as well as the internal audit program and set the dates of its ordinary meetings for the same year on March 18 , June 24, September 23 and December 16.
