The Moroccan money market remained balanced during the week of February 14 to 20, as investors awaited Bank Al-Maghrib’s first monetary policy meeting of 2025. This meeting comes at a time when inflation is showing signs of a slight acceleration. According to Attijari Global Research, the Consumer Price Index rose by 2% at the end of January, reaching its highest level in a year.
In response to these economic conditions, Bank Al-Maghrib adjusted its market intervention by reducing its seven-day advances, which now stand at 60.7 billion dirhams, down from 67 billion dirhams the previous week. Interbank rates remained aligned with the benchmark rate, while the Moroccan Overnight Index Average (MONIA) dropped by one basis point to 2.47%.
On the auction market, the Treasury raised 13.1 billion dirhams in February, surpassing its initial monthly target by 7%. During the last session of the month, short-term bond yields saw a decline, whereas medium-term rates recorded a slight increase. Specifically, the yields on 13-week and 52-week Treasury bills fell by 1 and 5 basis points, respectively, while the two-year bond yield rose by 3 basis points. Investor demand reached 7.7 billion dirhams, but only 3.1 billion dirhams were accepted, resulting in a 40% satisfaction rate.
Experts at Attijari Global Research believe that the Treasury will maintain its flexibility in the auction market until the end of the first quarter, supported by controlled inflation and a comfortable level of liquidity.
Bank Al-Maghrib’s total intervention in the market amounted to 142.4 billion dirhams, with 81.7 billion dirhams allocated to long-term operations. This included 47 billion dirhams in repurchase agreements, which fell by 4.3 billion dirhams over the week, and 34.7 billion dirhams in guaranteed loans, which increased following the creation of a new 5.2 billion dirham credit line and the expiration of another worth 914 million dirhams.
Meanwhile, excess liquidity placements slightly decreased over the week but remained above the 10-billion-dirham threshold, averaging 11.4 billion dirhams compared to 12.2 billion dirhams the previous week.
As financial markets keep a close eye on Bank Al-Maghrib’s upcoming policy meeting, current indicators suggest a stable and well-managed money market. The outcome of this meeting, particularly regarding inflation trends and key interest rates, will play a crucial role in shaping the country’s financial trajectory in the coming months.
