Rabat- The Moroccan dirham depreciated by 0.5 percent against the euro and appreciated by 1 percent vis-à-vis the dollar, according to the latest weekly indicators of the week from March 1 to 7, published by Bank Al Maghrib (BAM).
The central Bank’s indicators for this period also show that net international reserves are set at MAD 233.5 billion, which slightly decreased by 0.3 percent on a week-to-week basis, compared to a 5.5 percent decline on a year-over-year basis.
During this period, Bank Al-Maghrib injected MAD 47 billion in 7-day advances through a call for tenders and granted MAD 3.4 billion to the SME financing support program , with a total market intervention amounting to MAD 50.4 billion.
On the interbank market, the weighted average rate was 2.26 percent, while the volume of trade has increased from MAD 3 billion to MAD 3.5 billion, BAM said.
In terms of the stock market indicators, the MASI slightly rose by 0.1 percent, bringing its performance since the beginning of the year to 6.2 percent and the overall volume of trade amounted to MAD 719.3 million.
On January 15, Morocco’s Ministry of Economy and Finance officially widened the band in which the Moroccan dirham trades against a basket of currencies, 60 percent for the euro and 40 percent for the dollar, from ±0.3 percent to ±2.5 percent. Over a timeframe of 10 to 15 years, the ministry explained that it will move towards a free floating currency.
According to BMI Research, a Fitch Group firm that provides macroeconomic, industry and financial market analysis, Morocco’s new reform is “unlikely to prompt a sharp currency sell-off, limiting near-term risks to growth and inflation.”
The group also pointed out that this move is “likely to help the country in its efforts to attract greater investment to the kingdom and diversify trade, while the risks of disorderly depreciation are well contained given the country’s robust financial buffers.”