Bank Al-Maghrib: M3 Money Supply Growth Moderates to 7.8% in September 2025 Amid Credit Deceleration

Moroccan monetary aggregates | credit dynamics | emerging market liquidity indicators | fixed-income portfolio signals

Bank Al-Maghrib’s latest monetary statistics reveal a measured softening in broad money (M3) expansion to MAD 1,996.14 billion in September 2025, reflecting a year-over-year growth of 7.8%—down from 8.3% in August—consistent with prudent liquidity management that supports Morocco’s low-inflation regime (0.4% annual CPI) and appeals to global fixed-income allocators seeking stable EM anchors.

This moderation primarily stems from subdued bank credit growth to the non-financial sector (+3.0% YoY, from 3.4%) and net claims on central administration (+1.4% YoY), partially offset by accelerating official reserve assets (+14.1% YoY, up from 13.1%). For institutional investors, these dynamics affirm Morocco’s balanced monetary stance—bolstering dirham resilience (recent 0.5-0.8% softening vs. EUR/USD) and reserve buffers at MAD 429 billion—while signaling scope for Bank Al-Maghrib to sustain accommodative policy amid the 2026 Finance Bill’s sub-3% deficit target.

Component Breakdown: Deposits and Instruments Reflect Sectoral Shifts

M3’s deceleration manifested across key levers:

•  Sight deposits at banks eased to +10.1% YoY.

•  Term deposits contracted 1.1% YoY.

•  Currency in circulation accelerated to +9.8% YoY.

•  Holdings in monetary OPCVM units surged +24.8% YoY, underscoring rising appetite for liquid, low-risk vehicles ahead of OPCVM reforms introducing ETFs.

By institutional sector, non-financial private corporations saw monetary assets growth slow to +10.0% YoY, with sight deposits decelerating from +16.2% to +10.9% and OPCVM holdings from +30.5% to +27.9%. Household monetary assets remained quasi-stagnant at +6.6% YoY, featuring sight deposits at +9.2% and term deposits deepening to -3.8% (from -3.4%), indicative of cautious consumption patterns that align with contained inflation and support consumer staples’ defensive appeal in Casablanca portfolios.

Credit Trends: Selective Expansion with NPL Stability

Bank credit to the non-financial sector advanced +3.0% YoY in September, easing from +3.4%:

•  Private enterprise loans decelerated to +0.8% YoY (from +1.0%).

•  Public enterprise facilities slowed to +6.4% (from +9.2%).

•  Household lending held steady at +2.9% YoY.

By purpose, the slowdown reflected:

•  Treasury facilities contraction deepening to -6.6% YoY.

•  Real estate credit easing to +3.1% YoY.

•  Consumer credit accelerating to +4.2% YoY.

•  Equipment loans surging to +16.5% YoY, fueled by capex in infrastructure and renewables.

Non-performing loans (NPLs) rose +3.8% YoY, with the NPL ratio steady at 8.6%—a manageable level that reinforces banking sector resilience for credit-linked EM debt strategies.

Implications for Global Allocators: Yield Stability in a Growth-Conducive Environment

September’s monetary softening—amid accelerating reserves—highlights Morocco’s calibrated approach to liquidity, mitigating overheating risks while facilitating credit flows to high-multiplier sectors like equipment financing, which ties into the MAD 114.8 billion 2026 investment pipeline. For foreign funds, this backdrop enhances the Casablanca Stock Exchange’s yield profile (MASI +32% YTD) and dirham-denominated bonds, offering real yields buffered by FX reserves exceeding 8 months of imports. Amid OPCVM enhancements and ETF debuts, these indicators signal incremental allocation potential in Moroccan fixed-income satellites, blending carry with low-beta growth.