Morocco’s Money Supply Growth Slows in February 2025, Sparking Economic Concerns
In February 2025, Morocco’s money supply growth showed a slight deceleration, increasing by 6.7%—down from January’s 6.9%. This development, reported by the Bank of Morocco, reflects significant trends within the Morocco economy, influenced by a decrease in net debts to the central administration and fluctuations in official reserve assets. While some sectors of the financial sector Morocco exhibited vibrant growth, especially in bank loans Morocco directed at non-financial companies and households, the overall money supply faced headwinds. This article takes a closer look at the dynamics driving Morocco’s money supply and the implications for the nation’s economic landscape.
Overview of Morocco’s Money Supply in February 2025
In February 2025, Morocco’s money supply growth slowed to 6.7%, down from 6.9% in January, totaling approximately 1.87 trillion dirhams. This decrease reflects changes in net debts to the central administration and reserve assets, signaling economic adjustments.
The Bank of Morocco’s report indicates the slower growth is attributed to a drop in treasury financing and reserve assets, alongside an increase in bank loans to the non-financial sector, which remained crucial in sustaining money supply.
Factors Influencing Money Supply Growth
The slowdown in Morocco’s money supply growth is influenced by a decrease in net debts to the central administration, where growth declined significantly. Additionally, official reserve asset growth fell, indicating tighter economic conditions.
Despite these factors, the increase in bank loans directed to the non-financial sector contributed positively, highlighting the sector’s resilience and the effectiveness of lending strategies in supporting overall money supply.
Trends in Bank Loans and Lending
February 2025 saw a favorable trend in bank loans, especially for non-financial private companies, which grew by 1.6%. Public companies exhibited stronger loan uptake at 12%, indicating renewed confidence in the business environment.
Household loan growth also accelerated to 2.2%, reflecting an increase in consumer spending and housing demand, which serves as a positive sign for the Moroccan economy, despite challenges in non-performing loans.
Changes in Demand Deposits and Cash Assets
The growth rate of demand deposits with banks in Morocco remained stable at 10.3%, demonstrating consumer confidence and liquidity in the economy. Conversely, cash assets held by households witnessed a slowdown.
Non-financial private companies reported stronger growth in cash assets, rising to 16.5%, as a response to increased demand deposits and investments in monetary collective instruments, highlighting the sector’s dynamic financial health.
The Impact of Non-Performing Loans
The growth rate of non-performing loans in Morocco decreased from 3.8% in January to 3.2% in February, indicating improved loan quality and management within the banking sector.
These non-performing loans represented 8.7% of total bank loans, showing a slight increase from the previous month, which emphasizes the importance of ongoing efforts to address loan performance and stabilize financial systems.
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Frequently Asked Questions
What is the current money supply in Morocco?
As of February 2025, Morocco’s money supply is approximately 1.87 trillion dirhams, showing a growth rate of 6.7%, slightly down from 6.9% in January.
How have bank loans affected Morocco’s money supply?
Bank loans to the non-financial sector increased to a growth rate of 3.5%, contributing positively to the overall money supply in Morocco.
What role does the Bank of Morocco play in the economy?
The Bank of Morocco is crucial in regulating the monetary policy, influencing money supply growth, and overseeing the financial sector, including bank loans and reserves.
What factors are influencing the money supply growth rate in Morocco?
Factors include changes in net debts to the central administration and variations in official reserve assets, alongside increased bank lending to businesses and households.
What is the growth trend of loans to households in Morocco?
Loans to households have accelerated to a growth rate of 2.2%, indicating a healthy lending environment despite a minor slowdown in non-performing loans.
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