• Bank Al-Maghrib leaves benchmark rate unchanged at 2.25%

• Inflation seen at 1% in 2025 before rising to 1.9% in 2026

• Economy expected to grow 4.6% in 2025, driven by agriculture and investment

Morocco’s central bank kept its benchmark interest rate unchanged at 2.25% on September 23, citing contained inflation and continued uncertainty in the global and domestic economy.

“Given moderate inflation levels and uncertainties weighing on the economic outlook, the Board decided to maintain the key rate at 2.25%, while continuing to ease financing conditions for businesses, especially very small enterprises,” Bank Al-Maghrib said after its third quarterly meeting of the year.

The bank projects economic growth to accelerate from 3.8% in 2024 to 4.6% in 2025, before easing slightly to 4.4% in 2026. The rebound is expected to be supported by a 5% increase in agricultural value added this year, with cereal production estimated at 41.3 million quintals, and by a projected harvest of 50 million in 2026. Outside agriculture, growth is expected to hover around 4.5% in both 2025 and 2026, supported by public and private investment, particularly in infrastructure.

Inflation remains low, averaging 1.1% in the first eight months of 2025. It is forecast at 1% for the full year, nearly stable from 2024, before rising to 1.9% in 2026. Core inflation is projected to increase from 1.1% in 2025 to 2% in 2026.

On the external front, exports are expected to grow by 6.2% in 2025, driven by phosphates and derivatives, which should bring in 110.7 billion dirhams ($12.25 billion). A 9.4% increase is projected in 2026 with a recovery in the automotive sector. Imports are set to rise by 7.4% in 2025 and 7.1% in 2026, reflecting higher demand for capital goods. The energy import bill is expected to continue falling, reaching 94.4 billion dirhams in 2026.

Foreign reserves should keep rising to 418 billion dirhams by the end of 2025 and 434.5 billion in 2026, covering the equivalent of 5.5 months of imports. The current account deficit is projected to remain contained at 2.3% of GDP in 2025 and 2% in 2026.

On the fiscal side, Bank Al-Maghrib expects the budget deficit to narrow to 3.9% of GDP in 2025 and 3.4% in 2026, helped by stronger tax revenues and gradual spending restraint.