Bank Al-Maghrib (BAM) kept its key interest rate unchanged at 2.25% on 24 June 2025, at the second quarterly meeting of its Board in Rabat. The Board last cut the rate on 18 March 2025, by 25 basis points, its third reduction since June 2024.
The Board said its decision took into account inflation developing at levels in line with its medium-term price stability objective, a marked acceleration of non-agricultural growth and anchored inflation expectations, as well as the significant uncertainties surrounding the outlook. It said it would continue to monitor closely the pass-through of its recent rate cuts, particularly to the financing conditions of very small, small and medium-sized enterprises, and would take future decisions meeting by meeting.
INFLATION
Inflation slowed from an average of 2% in the first quarter of 2025 to 0.7% in April and 0.4% in May, mainly reflecting a deceleration in food price increases. BAM projected inflation of around 1% by the end of 2025 and 1.8% in 2026. Bank lending rates to the non-financial sector had fallen by a cumulative 45 basis points by the first quarter of 2025 since monetary easing began in June 2024.
GROWTH OUTLOOK
BAM forecast economic growth of 4.6% in 2025 and 4.4% in 2026, after 3.8% in 2024 according to annual national accounts published by the High Commission for Planning. Agricultural value added is expected to rise by 5% in 2025, based on a cereal harvest estimated at 44 million quintals, while non-agricultural growth is projected at around 4.5% in both 2025 and 2026, driven mainly by investment in infrastructure.
Internationally, the Board noted an exceptional level of uncertainty, driven notably by the United States' new trade policy, conflicts in Ukraine and the Middle East, and the war between Israel and Iran. Domestically, BAM expects the current account deficit to remain at around 2% of GDP in 2025 and 2026, and bank credit to the non-financial sector to grow by more than 6% in both years.
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