Morocco’s central bank left its benchmark interest rate unchanged at 3 percent, saying “the balance of risks is neutral and the central inflation forecast is permanently consistent with the price-stability objective.”
Mohamed Abu Basha, an economist at Cairo-based EFG-Hermes Holding SAE, said he had expected rates to remain on hold. “The economic environment remains weak given the linkages to Europe and fiscal consolidation,” he said in an e-mail before the central bank announcement.
Morocco’s economy, which expanded at its slowest pace since 2007 in the second quarter, will bounce back in 2013 as agriculture recovers from a drought last year, Abu Basha said. Farming output fell 9.6 percent in the second quarter from a year earlier, according to the statistics agency. Along with tourism, agriculture accounts for about 23 percent of the economy.
“The trade deficit widened by 11.8 percent to the end of November, while transfers of Moroccans living abroad and travel receipts shrank by 4 percent and 2.3 percent respectively,” the Rabat-based bank said in a statement posted on its website. “Revenues under foreign direct investment to the end of October rose 7.8 percent year-on-year.”