Economics
Rate Cuts ‘Meaningless’ as Virus Foils Record Morocco Easing
- Central bank likely to hold benchmark rate at record-low 1.5%
- Businesses, citizens press demands as pandemic hits economy
Photographer: Fadel Senna/AFP via Getty Images
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The economic disruptions caused by the spread of the coronavirus are exposing the limits of monetary policy in Morocco, with inflation staying below zero even after the central bank’s biggest interest-rate cut in history.
An easing cycle that started in March has done little to get the $119 billion economy back on track just as other defenses are proving inadequate and virus cases surge. Reducing the benchmark from a record-low 1.5% this week would amount to a “meaningless announcement” in the current climate, said Abdelouahed El Jai, a former central bank director.