Morocco loosens currency peg to boost exports and foreign investment
Cairo — Morocco will loosen its currency peg in a long-awaited move aimed at strengthening its economy and avoiding financial imbalances that forced a slew of emerging nations into sharp devaluations. Bank al-Maghrib, as the central bank is known, will allow the dirham to fluctuate 2.5% above or below its official rate, significantly widening the band from 0.3% each way. It will set a new reference rate for the dirham against the dollar on Monday. Economists and business people said Morocco was unlikely to join the long list of countries from Egypt to Uzbekistan that allowed their currencies to plummet in recent years, because the central bank was sitting on ample reserves and the dirham is already fairly valued. GDP expanded faster than the majority of countries in the Middle East and North Africa in 2017, according to International Monetary Fund estimates. The plan to loosen the peg, which is supported by the IMF and is the centerpiece of Morocco’s ambitions to transform itself in...
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