(Bloomberg) -- Morocco's central bank left its benchmark interest rate at an all-time low of 1.5%, saying progress with its Covid vaccination campaign and a rebound in the key agriculture sector would offset global inflationary pressure.
The decision, announced Wednesday in a statement, was in line with the expectations of economists. The central bank has held rates for five consecutive meetings after easing monetary policy between March and June 2020 as the pandemic ravaged the economy.
The decision comes as the North African kingdom embarks on a sweeping program championed by its monarch and focused on boosting economic growth.
Read also: Morocco King Gives Government Signal for Expansionary Budget
Bank al-Maghrib said it had taken measures to mop up excess foreign currency liquidity through its recent FX buy-back auctions, which have so far totaled $880 million. It projects inflation will rise to 1.2% in 2021 and 1.6% in 2022 up from 0.7% in 2020.
The bank projected the economy would grow 6.2% this year after contracting 6.3% last year. It said the inflation-adjusted effective exchange rate of the dirham should end the year 0.4% stronger and depreciate by 1.9% in 2022.
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