Morocco CB keeps rates unchanged
RABAT: Morocco’s central bank said yesterday economic growth would jump to 4.2 percent next year from an estimated 1.2 percent in 2016 on the back of sharply rising agricultural output.
It made the bullish projections as it kept its benchmark interest rate unchanged at 2.25 percent.
Abnormally dry weather across North Africa slashed the cereal harvest last season to 3.35 million tons, down 70 percent from the previous record 11 million tons. Last year’s drought was the worst in 30 years, the government said. But early season rainfall this year is up 22 percent from a normal year and 107 percent up from last year.
The bank, known as Bank al-Maghrib, revising down this year’s overall growth estimates from 1.4 percent. It lowered its key rate to 2.25 percent from 2.5 percent in March, its first cut in more than a year, to support the economy, in which agriculture accounts for more than 15 percent. The bank said it expected inflation to remain around 1.6 percent in 2016 and fall to 1 percent in 2017. Based on an average global oil price of $43.1 a barrel, the current account deficit should reach 2.8 percent of gross domestic product in 2016, slightly higher than expected, and 2.1 percent in 2017. — Reuters