Rabat – After almost three years of breaking records, inflation in Morocco is set to weather in 2024 returning to the recommended below 2% level, according to projections from the Higher Commission of Planning (HCP).
In a report published on Tuesday, HCP data indicated that inflation is set to average 1.8% in 2024, down from 2.8% in 2023.
For the second quarter of 2023, the growth rate of consumer prices, although still high, would have slightly decelerated for the first time in six consecutive quarters of continuous increase, growing at a 7.1% year-on-year rate, compared to a 9.1% rise in the previous quarter.
The shift in trend is driven by a significant decline in non-food prices by over 50%. Non-food products are expected to grow at a 1.4% rate, compared to the 3.5% rise in the first quarter. Food prices are also set to grow at a slower rate in the second quarter of 2023, dropping from 17% to 15%.
Domestic demand
Domestic demand is expected to make a positive contribution to GDP growth in Morocco in 2024, amounting to 3.1% percentage points instead of the estimated one point in 2023.
The recovery in domestic demand is due to increased household consumption, which is projected to rise by 1.6%, contributing one percentage point to economic growth.
Improved agricultural income and the sustained trend in external transfers are all factors contributing to the recovery in domestic demand.
Overall, national consumption is projected to grow by 2%, indicating a higher growth rate compared to 2023, and contributing 1.7 percentage points to economic growth in 2024.
In addition, the report argues that the expected improvement in the agricultural campaign and reduced demand for live animals should reduce imports.
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