Latest news with #MONIA
Morocco World
11-04-2025
- Business
- Morocco World
Banking Liquidity Deficit Widens by 21.9% in Morocco
Rabat – The liquidity deficit in Morocco's banking system has grown by 21.9%, reaching MAD 168.3 billion in the week from April 3 to 9. According to BMCE Capital Global Research (BKGR), this increase in the deficit comes as Bank Al-Maghrib (BAM) reduced its 7-day advances by MAD 2.4 billion, bringing the total to MAD 49.2 billion. BKGR's recent 'Fixed Income Weekly' report highlights this development, which reflects tightening conditions in the money market. At the same time, treasury placements have surged. The daily maximum outstanding balance reached MAD 51.1 billion, a sharp rise from the previous period's MAD 8.2 billion. On interest rates, the Weighted Average Rate (WAM) has dropped to 2.25%, while the Moroccan Overnight Index Average (MONIA) has seen a slight dip, standing at 2.231%. Looking forward, BKGR anticipates that BAM will slow the pace of its market interventions. The central bank is expected to reduce its 7-day advances to MAD 51.1 billion, down from MAD 66.46 billion in prior weeks. Morocco's banking liquidity deficit improved by 8.26% in January, reaching MAD 136.8 billion ($13.4 billion). As for bond market projections, the modest issuance observed this week confirms the relative comfort of the treasury, which continues to benefit from its successful international bond issue. That issuance came just days before global markets were shaken by a new wave of tariffs imposed by Donald Trump, an event that could have affected Morocco's access to financing. The evolving international environment, which now appears likely to accelerate the pace at which major central banks lower key interest rates, may ultimately support a broader downward trend in bond yields. Meanwhile, the recent widening of the liquidity deficit notes ongoing pressure in Morocco's financial system, even as the treasury maintains a stable position. This means that shifting international dynamics and the potential for lower global rates could play a stabilizing role in the months ahead. Tags: BAMliquidity deficitMorocco economyMorocco liquidity deficit
Morocco World
18-02-2025
- Business
- Morocco World
Bank Al-Maghrib Launches Interbank Forward Market on February 19
Doha – Bank Al-Maghrib (BAM) announced today the launch of an interbank forward market for foreign exchange swaps and overnight index swaps (OIS) linked to MONIA (Moroccan Overnight Index Average), set to begin operations on February 19. The initiative is part of BAM's broader strategy to deepen the foreign exchange market, which began in 2018. According to the central bank's press release, this new market will provide economic operators with 'a transparent and reliable reference for their hedging operations against interest rate and exchange rate risks.' The market introduces two key financial instruments. The first is the foreign exchange swap, which BAM describes as 'a transaction whereby two parties agree to exchange one currency for another and then proceed with an opposite exchange at a later date.' This instrument combines a spot foreign exchange transaction with a forward transaction, allowing market participants to manage their foreign exchange risk exposure while benefiting from enhanced flexibility and cost predictability. The second instrument is the OIS linked to MONIA, which the central bank explains is 'a transaction whereby two parties agree to exchange, on an agreed notional amount and period, a fixed interest rate determined at the time of the transaction against a variable interest rate indexed to the MONIA index.' This tool is primarily designed to help financial market participants hedge against short-term interest rate fluctuations and derive market expectations about future short-term interest rates. The establishment of this market has been made possible through active collaboration between market-making banks and the European Bank for Reconstruction and Development (BERD). The initiative aims to give new momentum to the development of derivative products in Morocco. The launch signifies a major leap in the modernization of Morocco's financial instruments and is expected to strengthen the depth of the national capital market. It also aligns with the country's objectives for the gradual liberalization of the dirham. Read also: Morocco's Financial System Shows Resilience Amid Global Uncertainties Tags: Bank Al-Maghribfinancemoroccan banking
