With the upcoming monetary policy meeting scheduled for December 17, financial investors remain split on whether Bank Al-Maghrib (BAM) will maintain its key rate or implement a modest cut. A survey conducted by Attijari Global Research (AGR) reveals a 55% likelihood of a status quo versus a 43% chance of a 25 basis points (bps) rate cut. The findings, detailed in AGR’s latest Research Report – Strategy, are based on responses from 35 of Morocco’s most influential financial market players.
The survey breaks down perspectives by investor type, reflecting varying levels of confidence in BAM’s upcoming decision.
Local institutional investors estimate a 52% probability of the key rate remaining unchanged, compared to a 48% chance of a 25 bps reduction. Key market players, referred to as “Reference Actors,” lean more heavily toward stability, with a 66% probability of no change and a 34% likelihood of a 25 bps cut.
Individual investors, however, show a stronger preference for monetary easing. They estimate a 57% likelihood of a 25 bps rate cut, with only 29% expecting the rate to stay unchanged. Interestingly, they also assign a 14% probability to a more aggressive cut of 50 bps, suggesting growing expectations for action to stimulate the economy.
Foreign investors appear the most conservative, with 70% predicting that BAM will keep its key rate steady, while only 30% anticipate a 25 bps reduction.
Bank Al-Maghrib’s decision comes at a critical time, as Morocco balances inflationary pressures with the need to support economic growth. While maintaining the current rate could signal confidence in economic stability, a rate cut—however modest—might reflect a pivot toward stimulating investment and consumption amid challenging global conditions.
This division among investor categories highlights broader uncertainties in the financial landscape, underscoring the careful balancing act BAM must perform. The December 17 meeting will likely set the tone for the monetary policy outlook as the nation heads into 2025.
