Morocco prepares for first stage of currency flexibility
- June 28, 2017
Morocco’s central bank is due to announce this week the date for the first phase of liberalising the dirham currency, an IMF-backed reform to strengthen the North African kingdom’s economy.
Most economists expect the currency transition to be smooth with foreign reserves solid, the dirham balanced and public finances improved by lower global oil prices that eased the cost of energy imports.
The central bank late last year said the first stages of a gradual move from currency controls to a flexible exchange rate would be implemented in the second half of 2017, along with other reforms like inflation targeting.
Central Bank Governor Abdellatif Jouahri has said he will release the start date by the end of June, but denied that floating the currency will be a devaluation, in a statement in response to market speculation before the announcement.
Foreign reserves have dropped $4.4 billion in the last two months. Foreign exchange reserves are at 218.5 billion dirham ($22.38 billion), according to central bank data, 2.3 percent lower than a week ago and 10.8 percent below a year ago.
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