The National Bank of Morocco held its policy rate unchanged at 2.25% at its September 24th 2019 meeting. The bank noted that inflation remains low, averaging 0.2% during the first eight months of the year, mainly due to lower food prices; and it is expected to remain subdued in the coming months, easing to 0.4% in 2019 (previously seen at 0.6%) from 1.9% in 2018, before rising to 1.2% in 2020, driven by the expected recovery of internal demand. Regarding growth, the economy is projected to slow to 2.7% in 2019 (previously seen at 2.8%) from 3% a year ago, mainly due to agricultural activity; but to quicken to 3.8% in 2020, as agricultural output is expected to grow 6.3%. The Board also decided to reduce the monetary reserve rate to 2% from 4%, to boost banking liquidity and confirmed that will issue 2 international bonds this year and next year that would boost international reserves to 239 billion dirhams in 2019 and 234.3 in 2020, enough to cover five months of imports. Interest Rate in Morocco averaged 3.76 percent from 1995 until 2019, reaching an all time high of 7 percent in August of 1995 and a record low of 2.25 percent in March of 2016.
Interest Rate in Morocco is expected to be 2.25 percent by the end of this quarter, according to Trading Economics global macro models and analysts expectations. Looking forward, we estimate Interest Rate in Morocco to stand at 2.00 in 12 months time. In the long-term, the Morocco Interest Rate is projected to trend around 2.00 percent in 2020, according to our econometric models.