With just two days remaining until Bank Al-Maghrib’s first board meeting of 2025, analysts widely anticipate that the central bank will keep its key interest rate unchanged at 2.5%. This comes after a 25-basis-point cut in its last meeting of 2024.
The expectation to maintain the rate is supported by stable inflation trends. According to data from the High Commission for Planning, Morocco’s consumer price index (CPI) rose by 2% in January 2025 compared to the same period last year. This increase was mainly driven by a 3.3% rise in food prices and a 1.1% increase in non-food product prices.
Additionally, credit activity in the country has accelerated. Bank Al-Maghrib reported that loans to the non-financial sector grew by 3.3% in January 2025, up from 2.6% the previous month. Loans to private companies increased by 1.2%, while public sector loans rose by 8.6%. Household borrowing also showed an upward trend, reaching 2% compared to 1.7% in December 2024.
Economic experts suggest that Bank Al-Maghrib is likely to maintain the current interest rate due to the absence of inflationary pressures and improving economic outlooks. Economist Omar Bako emphasized that recent rainfall could boost agricultural production, leading to lower food prices and further easing inflationary concerns. Moreover, growth forecasts from the International Monetary Fund, the High Commission for Planning, and Morocco’s Finance Law report all indicate positive economic prospects, reducing the need for further rate cuts to stimulate the economy.
A recent survey conducted by Attijariwafa Bank Group’s research unit supports this outlook, revealing that 94% of surveyed investors expect the key interest rate to remain at its current level, while only 6% anticipate a further 25-basis-point cut. Notably, institutional investors estimate a 91% probability of keeping the rate unchanged, while foreign investors and individual stakeholders lean more toward a rate cut.
With a broad consensus among analysts and investors favoring stability, all eyes are now on Bank Al-Maghrib’s upcoming decision. However, given the uncertainties in the global economic landscape, the possibility of an unexpected move by the central bank remains on the table.
