Morocco’s central bank held its interest rate steady at 3.0 percent in light of inflationary risks that are “slightly tilted to the upside” though inflation forecasts remain consistent with the bank’s medium-term price stability objective.
The Bank of Morocco, which has held rates steady since March 2012, said after analyzing the impact of a new index system of certain petroleum products that inflation is broadly in line with the bank’s forecast from June, taking note of projections that show an average inflation rate of 2.2 percent this year, 1.7 percent in 2014, 1.5 percent in the fourth quarter of 2014, and an average of 1.8 percent over the forecast horizon.
Morocco’s headline inflation rose to 1.9 percent in August from 1.6 percent in July for an average of 2.4 percent in the first half.
Morocco’s economy expanded by 4.3 percent in the second quarter, down from 4.8 percent in the first and the central bank expects full-year growth of between 4.5 and 5.0 percent.
The central bank said Morocco’s trade deficit narrowed by 3.1 percent in August due to lower imports and net international reserves rose by 4.3 percent to 150.2 billion dirhams, representing four months and four days of imports of goods and services.