Morocco's central bank, Bank Al-Maghrib, has announced that it will keep its key interest rate unchanged at 2.25%. The decision was made during its third quarterly meeting of 2026, citing a manageable inflation outlook and steady non-agricultural economic growth. Despite ongoing uncertainty, the bank believes that current monetary policy is suitable. It will continue to monitor domestic and external developments closely.
The interest rate has remained at this level since March 2025, when it was lowered by 25 basis points as part of an easing cycle that began in June 2024. This easing cycle included cumulative reductions of 75 basis points. Bank Al-Maghrib will make future decisions based on the latest available data. Inflation expectations for 2026 have been revised downward to 0.7%, compared to 1.5% in previous forecasts.
The bank's inflation forecast for 2027 has also been lowered from 2.1% to 1.5%. Actual inflation averaged 0.3% during the first eight months of 2026, driven by lower food prices. Support for road transport and stable prices for butane gas and electricity have limited the pass-through of global energy price increases to the domestic market. The bank expects core inflation, which excludes volatile goods, to decline by 0.2% in 2026.
The central bank forecasts that core inflation will rise to 2.2% in 2027 as the impact of lower food prices, particularly olive oil, fades and imported inflation remains relatively high. These projections align with recent data from the High Commission for Planning, which reported a 0.3% annual decline in consumer prices in August. This decline was driven by a 3.9% drop in food prices.
Bank Al-Maghrib has revised its economic growth forecast for 2026 downward to 4.4%, from 5.2% in June. However, it expects a 16% increase in the agricultural sector's value-added, driven by a harvest of around 93 million quintals. Non-agricultural activity growth is predicted to slow to 3.1% in 2026, due to weaker performance in some extractive and manufacturing industries.
The bank forecasts that Morocco's economy will grow by 4.9% in 2025, followed by 4.4% in 2026 and 2.9% in 2027. The labor market showed improvement in the second quarter, with 406,000 jobs created year-over-year. The unemployment rate declined to 9.5% nationally, 11.9% in urban areas, and 5.4% in rural areas.
The central bank expects energy costs to rise by 28.4% in 2026, reaching 138.1 billion dirhams. This increase is driven by higher oil prices and shipping disruptions. The bank forecasts that the current account deficit will widen to 4.6% of GDP in 2026, before declining to 3% in 2027. Official reserves are expected to reach 502.8 billion dirhams by the end of 2026.
Key points
- Morocco's central bank keeps interest rate at 2.25% amid manageable inflation and steady economic growth.
- Inflation expectations for 2026 and 2027 have been revised downward to 0.7% and 1.5%, respectively.
- The bank forecasts economic growth of 4.4% in 2026, driven by a 16% increase in the agricultural sector's value-added.
