Inflation expected to reach 1.5% in 2024 in Morocco

Domestic inflation in Morocco is expected to reach 1.5% by the end of the current year, before rising to 2.7% in 2025, according to Bank Al-Maghrib (BAM).

These forecasts consider the recent return of inflation to low rates and the resumption of the decompensation process, says the central bank in a statement issued following its second quarterly board meeting of 2024, held on Tuesday in Rabat.

The underlying inflation component, reflecting the fundamental trend in prices, averaged 2.1% over the first five months of the year and should remain near this level until the end of 2025, the same source said.

Regarding the transmission of previous monetary policy decisions to financial conditions, bank lending rates remained virtually stable for the second consecutive quarter. There has been a cumulative increase of 116 basis points since the start of monetary tightening in September 2022, reaching the first quarter of 2024. The rise in rates affected businesses more than individuals, with a less significant impact on very small, small, and medium-sized enterprises (VSMEs) compared to large companies.