Domestic inflation 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 return of inflation to low rates in recent months 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, which reflects the fundamental trend in prices, averaged 2.1% over the first five months of the year, and should remain close to this level until the end of 2025, the same source said. As for the transmission of previous monetary policy decisions to financial conditions, bank lending rates remained virtually stable for the second consecutive quarter, with a cumulative increase of 116 basis points between the start of monetary tightening in September 2022 and the first quarter of 2024.
The rise in rates affected businesses more than individuals, and was less significant for very small, small and medium-sized enterprises (VSSMEs) than for large companies.
