Almost one week after the launch of the Dirham float, head of Morocco’s central bank, Abdellatif Jouahri, and Economy and Finance Minister, Mohammed Boussaid, reassured that the flexible exchange rate will not lead to price hikes. This reform of the exchange system is “a step forward that aims at strengthening Morocco’s economy at the international level, builds on macro-economic achievements and sector-based reforms and boosts the openness of Morocco’s economy,” said Boussaid. He added that the Dirham devaluation will not exceed 2.5%, and that the impact of the flexible exchange rate on growth is estimated at 0.2 points. Yet, both the Central Bank and the Economy and Finance Ministry pointed to the impact of the slight Dirham devaluation on fuel prices. A devaluation of 2.5% of the dirham against the dollar resulted in a rise of gasoline prices by 1.6%.

Source: The North Africa Journal January 19, 2018 09:56 UTC