Inflation in Morocco is expected to fall sharply to 1% in the final quarter of 2024, according to a recent update from Bank Al-Maghrib (BAM), Morocco’s central bank following its quarterly board meeting.
The bank attributed the decrease to stabilizing global and domestic factors. The annual inflation rate represents a significant drop from the 6.1% recorded in 2023.
Core inflation, which excludes volatile food and energy prices, will follow a similar trajectory, declining from 5.6% in 2023 to 2.1% in 2024. Bank Al-Maghrib forecasts further moderation, with inflation settling at 2.4% in 2025 and 1.8% in 2026.
The decline reflects a broader global trend, as inflation rates in advanced economies also move closer to central bank targets. For instance, US inflation is projected to stabilize at 2.6% by 2025, while the eurozone aims for 2% within the same timeframe.
Domestically, BAM credited improved monetary policy transmission for the positive outlook. Following a 25-basis-point key interest rate cut in June, lending rates fell, making borrowing more accessible.
Morocco’s central bank implemented another 25-basis-point reduction this quarter, setting the key rate at 2.5%, in line with its goal of maintaining price stability.
Despite these gains, BAM noted persistent challenges. Agricultural production remains vulnerable to unpredictable weather, and international uncertainties—stemming from geopolitical conflicts and policy shifts in the US—pose risks to Morocco’s economic outlook.
“While inflation levels align with our price stability objectives, the international environment remains highly uncertain,” the bank’s board stated.
In addition, lower energy costs provided relief, with Brent crude prices declining to USD 79.8 per barrel in 2024 and expected to fall further to USD 69.1 by 2026. The trend, coupled with stable phosphate prices and rising food imports, has eased Morocco’s fiscal pressures.
Looking ahead, Bank Al-Maghrib’s projections for 2025-2027 indicate a steady economic recovery. Non-agricultural activities are set to expand, supported by infrastructure investments and robust export growth in sectors like automotive and phosphates.