According to Bank Al-Maghrib (BAM), Morocco’s money supply, measured by the M3 aggregate, reached 1.779.6 billion dirhams in May, marking a 4.3% year-on-year increase, maintaining the same growth rate as the previous month.

Factors influencing monetary growth

BAM’s recent monetary statistics bulletin attributes this stability to a combination of factors. There was a slowdown in the growth of bank credit to the non-financial sector, which decreased from 2.7% to 2.1%. Conversely, net claims on the Central Administration saw an increase of 2.3%, following a previous decline of 0.4%.

Official reserve assets and currency circulation

Official reserve assets (AOR) rose by 4.9% after remaining stable in April 2023. The annual growth rate of the M3 aggregate reflects several trends, including an acceleration in the growth of currency in circulation to 10.2% from 8.5%, a reduction in the decline of term deposits from 6.8% to 4.5%, a slowdown in the growth of sight deposits with banks from 7.9% to 6.9%, and a deeper decline in economic agents’ holdings of monetary OPCVM (collective investment schemes) from 12.5% to 18.5%.

Sectoral breakdown of monetary assets

By institutional sector, excluding currency in circulation, the growth of household monetary assets accelerated to 4.4% from 3.8%. In contrast, the growth of monetary assets of private non-financial corporations slowed significantly from 5% to 0.4%. This includes a deceleration in the growth of their sight deposits from 14% to 8.1%, and a sharper decline in their holdings of monetary OPCVM to 23.6% from 12.7%.

However, the decline in their term deposits eased to 14.9% from 20.6% the previous month.