Morocco's central bank kept the key interest rate unchanged at 1.5 percent, for the 12th consecutive month, as it attributed the reason to the fact that the outlook for the economy is still "surrounded by a high level of uncertainty." The Bank revealed that inflation reached 1.7 percent on average in the months of April and May, compared to 0.7 percent in 2020, and 0.1 percent in the first three months of 2021.
The Moroccan Central Bank expected that the Kingdom's economy will grow this year by 5.3 percent, driven by an increase in the added value of non-agricultural activities by 3.6 percent and an increase in the added value of the agricultural sector by 17.6 percent.
In this context, the Governor of the Central Bank of Morocco, Abdellatif Jouahri, confirmed that "Morocco will not move to a new stage of floating the local currency exchange rate, at a time when the economy is suffering from the repercussions of the Corona pandemic."
Jouahri affirmed, "Morocco rejects the position of the International Monetary Fund, which urged accelerating the liberalization of the dirham exchange rate, and heading towards flotation directly, because we are the ones who will decide when we will implement the new phase of flotation, not the International Monetary Fund."
Morocco began floating its local currency in January 2018, when it allowed the exchange rate of the dirham to move by a margin of 2.5 percent, up or down, against a basket of the euro and dollar currencies, as a first stage for a full float over a period of 10 years.
Source (The New Arab Newspaper, Edited)
