Morocco’s Central Bank Maintains Benchmark Interest Rate at 2.25% with Inflation Remain Steady

Morocco’s central bank announced, following its quarterly board meeting, that it has decided to keep the benchmark interest rate unchanged at 2.25%, stating that current borrowing costs remain consistent with inflation expectations.

In its statement, the bank projected that average inflation will decline to around 1% in 2025, mainly due to falling food prices, before gradually rising to 1.8% in the following year.

The central bank highlighted ongoing uncertainty surrounding the economic outlook, citing global trade dynamics, geopolitical conflicts, and the performance of Morocco’s agricultural sector as key risk factors.

At the same time, Morocco is moving forward with new infrastructure projects aimed at developing the natural gas sector, positioning the country to better respond to evolving global energy challenges.

The Moroccan economy is expected to grow by 3.8% in 2024, accelerating to 4.6% in 2025 and slightly easing to 4.4% in 2026, supported by stronger production and export activity.

Despite the recent 10% tariff imposed by the United States on imports, the central bank indicated that the impact on Morocco will be minimal, as trade with the U.S. accounts for only a small share of the country’s exports.

Morocco’s central bank projects that the current account deficit will remain stable at around 2% of GDP in both 2025 and 2026, buoyed by increased exports of phosphate and automobiles.

Foreign exchange reserves are expected to reach 407 billion dirhams ($44.7 billion) in 2025 and increase to 423.7 billion dirhams in 2026, enough to cover 5.5 months of imports.

On the fiscal side, the budget deficit is forecast to narrow to 3.4% of GDP by 2026, down from 3.9% this year, as rising tax revenues help balance the growth in public investment spending.