Moroccan Dirham Strengthens Against US Dollar, Holds Steady Against Euro
Rabat, Morocco – The Moroccan Dirham (MAD) showed resilience in the currency market, appreciating by 0.75% against the US dollar (USD) between June and July 2024. This positive trend was reported in the latest monthly bulletin on economic, monetary, and financial conditions released by Bank Al-Maghrib (BAM), Morocco’s central bank. The Dirham remained relatively stable against the Euro (EUR) during the same period.
This recent performance of the Dirham can be attributed to several factors, including:
Improved economic outlook for Morocco: The International Monetary Fund (IMF) projects Morocco’s economy to grow by 3.9% in 2024, driven by a rebound in agriculture and continued growth in tourism. This positive outlook can attract foreign investment, increasing the demand for Dirhams and boosting its value.
Increased remittances: Remittances from Moroccans living abroad play a significant role in the Moroccan economy. A surge in remittances, particularly during holiday seasons, can strengthen the Dirham.
Tourism rebound: Morocco’s tourism sector, a significant contributor to the country’s foreign exchange reserves, has witnessed a strong recovery post-pandemic. This influx of tourists further supports the Dirham’s value.
The report also highlighted key developments in the foreign exchange market:
Interbank Market Activity: The volume of foreign exchange transactions against the Dirham in the interbank market reached MAD 47.5 billion in June 2024. This represents a 22% decrease compared to June 2023, potentially indicating a more stable exchange rate environment.
* Bank-Customer Transactions: Customer purchases of foreign currency at banks totaled MAD 32.9 billion in spot transactions at the end of June 2024, compared to MAD 34.1 billion a year earlier. Forward purchases remained relatively stable at MAD 15.9 billion. On the sales side, spot transactions amounted to MAD 32.2 billion, and forward sales reached MAD 2.5 billion.
The last foreign exchange auction conducted by Bank Al-Maghrib took place in December 2021, suggesting a period of relative stability in the Dirham’s exchange rate.
Looking Ahead
The Dirham’s recent performance reflects the resilience of the Moroccan economy amidst global economic uncertainties. Factors such as inflation, interest rate differentials, and geopolitical developments will continue to influence the Dirham’s exchange rate in the coming months.
