Moroccan Dirham Slightly Appreciates Against Euro, Dollar

The Moroccan Dirham edged higher by 0.74% against the Euro and by 1.1% against the US Dollars between March 10-16.

Rabat – The Moroccan Dirham edged higher by 0.74% against the Euro and by 1.1% against the US Dollars between March 10-16.

Between March 17-18, the Moroccan dirham continued to increase in value against the Euro, going from MAD 10.8237 to MAD 10.8149 per €1, a 0.08% increase in value, according to data from Morocco’s central bank, Bank Al-Maghrib (BAM).

After showing signs of recovery against the US Dollar, the Moroccan dirham is likely to return to a downward trajectory following news of the US Federal Reserve approving a 0.25% hike in interest rate earlier this week.

The US central bank’s decision to increase interest rates is the first of its kind since 2018. As the US Dollar is the primary currency for foreign trade transactions, the move will likely affect trade balances worldwide including in Morocco.

The US Federal Reserve had announced plans to increase interest rates in 2021 in an attempt to bring down inflation.

The inflation rate in the US is dangerously approaching the 8% threshold as it stood at 7.9% as of March 10, according to data platform TradingEconomics.

Increased government spending as a result of COVID-induced increase in healthcare spending, including vaccine purchase, has shot up inflation rates worldwide.

With most governments having invested in maintaining companies and individuals financed throughout the COVID-19 productivity hiatus, economic stimulus packages have also contributed to the rise in global inflation rates.

Anticipating the Federal Reserve’s decision to increase interest rates, the US Dollar reached its highest level in the past seven months, driving up the exchange rate against the Moroccan Dirham.