Moroccan Dirham Experiences Fluctuations Against Major Currencies

The Moroccan dirham appreciated by 1.1% against the U.S. dollar while depreciating by 0.8% against the euro from February 27 to March 5, according to Bank Al-Maghrib. During this period, official reserve assets remained stable. The stock market saw a decline of 2.7%, with significant decreases across various indices.

Between February 27 and March 5, the Moroccan dirham appreciated by 1.1% against the U.S. dollar, although it depreciated by 0.8% against the euro, as reported by Bank Al-Maghrib (BAM). Notably, no foreign exchange operations took place during this period, as highlighted in BAM’s weekly bulletin.

As of February 28, the official reserve assets were valued at MAD 367.9 billion (approximately $37.7 billion), remaining stable compared to the prior week and increasing by 2.3% year-on-year. During this same timeframe, BAM recorded an average daily intervention volume of MAD 146.9 billion (USD 14.9 billion), with various allocations across different mechanisms including MAD 65.2 billion in 7-day advances and MAD 47 billion in long-term repurchase agreements.

In the interbank market, daily trading volumes increased to MAD 3.8 billion (USD 386 million), with an average interbank rate of 2.5%. On March 5, BAM injected MAD 66.1 billion (USD 6.7 billion) in 7-day advances, indicating continued support for liquidity in the banking system as of March 6.

In the stock market, the MASI index suffered a decline of 2.7% from February 27 to March 5, resulting in a year-to-date performance of 12.5%. Contributing factors included a 2.9% fall in the banking index, an 8% decrease in the real estate index, a 4% dip in telecommunications, and a 3.2% drop in transportation services. The Price-to-Earnings Ratio (PER) also declined from 24.9 to 24 week-on-week, while the trading volume decreased to MAD 1.4 billion (USD 141 million) from MAD 3 billion (USD 304 million) the previous week.

The Moroccan dirham’s recent appreciation against the U.S. dollar and corresponding depreciation against the euro underscore the volatility within currency markets. With stable reserve assets and tailored interventions by Bank Al-Maghrib, the banking system appears robust. However, the decline in the stock market and the drop in the Price-to-Earnings Ratio highlights critical areas for review and potential concern within the economy.

Original Source: www.moroccoworldnews.com