Morocco’s bond market continues to trend downward following Bank Al-Maghrib’s surprise decision to cut its benchmark interest rate by 25 basis points. This dovish signal, delivered during the central bank’s first meeting of the year, has triggered a general decline in yields across both the primary and secondary markets.
On the money market, liquidity conditions improved slightly, with the average banking liquidity deficit narrowing by 1.5% to MAD -138.6 billion. Bank Al-Maghrib also reduced its 7-day advances to MAD 66.02 billion. Treasury placements remained stable, peaking at MAD 7.5 billion in daily outstanding. The interbank weighted average rate (TMP) declined to 2.25%, while the overnight index (MONIA) ticked up slightly to 2.479%.
In the primary market, the Treasury raised MAD 1.05 billion, just 25% of the MAD 4.14 billion offered. The issuances were focused on 13-week, 52-week, and 2-year maturities, all of which saw notable rate cuts: -12 basis points on the 13-week, and -24.7 basis points on both the 52-week and 2-year lines. Final cutoff rates stood at 2.20%, 2.3225%, and 2.4305%, respectively.
The secondary market mirrored this movement, with sharp drops in short-term yields: -26.3 basis points for the 13-week, -25.16 for the 26-week, and -22.48 for the 52-week. Longer maturities also retreated, though to a lesser extent: -14.16 basis points on the 5-year, -13.9 on the 10-year, and -11.88 on the 30-year.
This widespread decline reflects the accommodative stance adopted by Bank Al-Maghrib, which appears committed to maintaining supportive monetary conditions amid ongoing economic uncertainty. According to BMCE Capital Global Research, the central bank is expected to slightly reduce its intervention volumes to MAD 61.74 billion in the upcoming week.
Looking ahead, the downward trajectory in bond yields is likely to continue. Supporting this trend is the announcement of an upcoming international bond issuance by the Moroccan Treasury, with a consortium of global banks already mandated for the operation—a clear signal of the government’s intent to diversify its funding sources.
