The Central Bank of Morocco (BAM) on Tuesday raised its key rate by 50 basis points, to 2%, in order to curb a “sharp acceleration of inflation”, according to a press release from the institution.
This increase, expected, was decided to ensure the conditions for a rapid return to levels in line with the objective of price stability, specifies the press release from the central bank published after the quarterly meeting of its board.
It occurs in a context of inflationary growth fueled by soaring commodity prices worldwide.
Thus the consumer price index increased by 8% in August over one year, driven mainly by the increase in food and fuel prices, according to the BAM.
Today, prices are burning consumers’ shopping carts and their wallets. Inflation is cruel for low incomes, the daily L’Economiste warned in its editorial on Monday, saying that getting out of the crisis will be difficult.
Over the whole of 2022, the monetary institution expects inflation of 6.3% (compared to 1.4% in 2021). It would return 2.4% in 2023.
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Growth in economic activity will slow down significantly to 0.8% in 2022 (+7.9% in 2021), driven by a 14.7% decline in agricultural value added and a slowdown in the pace of activities non-agricultural, adds the BAM, which forecasts a recovery of 3.6% in 2023 (condition of a good grain harvest).
This situation remains deeply marked by the consequences of the pandemic (of Covid-19) and the implications of the war in Ukraine, but also by the repercussions of a particularly severe drought, underlines its press release.
The economy of the Maghreb country remains largely dependent on the agricultural and fishing sector, which still represented nearly 12% of GDP in 2020.