Rabat – Bank Al-Maghrib (BAM) expects economic growth to reach 5% in 2025, driven by robust non-agricultural activity and a recovery in agriculture, according to the central bank’s final quarterly board meeting held in Rabat.
The board noted that growth is likely to remain solid over the medium term, averaging 4.5% in 2026 and 2027, supported by sustained investment and improving labor market conditions.
Non-agricultural sectors are projected to maintain strong performance, while agricultural value added is expected to improve, assuming a return to average cereal harvests.
Global and domestic context
The domestic growth outlook stands out amid a global economic slowdown, with uncertainty linked to trade policies and geopolitical tensions.
While international growth is expected to decelerate through 2026, Morocco’s economy shows relative resilience thanks to sectoral diversification and investment efforts.
Inflation and monetary conditions
Inflation remains low, averaging 0.8% over the first ten months of 2025, supported by improved food supply, notably olive oil, and lower fuel prices.
Bank Al-Maghrib projects a gradual rise toward levels consistent with price stability, with inflation expected at 1.3% in 2026 and 1.9% in 2027.
Inflation expectations remain well anchored. In this context, the Board decided to keep the key interest rate unchanged at 2.25%, while continuing to monitor developments closely.
External accounts and fiscal outlook
Exports are projected to grow, driven by phosphate products and a recovery in automotive shipments, while tourism receipts and remittances are expected to remain strong.
The current account deficit is forecast to stay below 2% of GDP over the medium term. Foreign exchange reserves are projected to strengthen steadily, providing coverage equivalent to nearly five and a half months of imports by 2027.
Fiscal consolidation is also expected to continue, with the deficit gradually declining under the 2026 Finance Act and the 2026-2028 three-year fiscal framework.
Unchanged rate
Bank Al-Maghrib’s board decided to maintain the key interest rate at 2.25%, judging the current level appropriate in light of Morocco’s low inflation and stable financial conditions.
While the transmission of previous monetary easing to lending rates remains partial, the board emphasized that it will continue to monitor domestic and international developments closely, including geopolitical tensions and weather-related risks, and adjust its monetary stance as needed on a meeting-by-meeting basis.
Overall, Bank Al-Maghrib projects a resilient domestic economy, underpinned by investment, sectoral performance, and supportive external and fiscal conditions.
The board emphasized that it will continue to base future monetary decisions on the latest available data.
