Morocco's Economic Growth Expected to Slow Down in Q1 2019

People shop in a photo illustration at vegetable market in Casablanca, Morocco, June 29, 2017. (File photo: Reuters)
People shop in a photo illustration at vegetable market in Casablanca, Morocco, June 29, 2017. (File photo: Reuters)
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Morocco's Economic Growth Expected to Slow Down in Q1 2019

People shop in a photo illustration at vegetable market in Casablanca, Morocco, June 29, 2017. (File photo: Reuters)
People shop in a photo illustration at vegetable market in Casablanca, Morocco, June 29, 2017. (File photo: Reuters)

Morocco’s economic growth is expected to record a 2.5 % during Q1 of 2019 compared to 3.3 % in Q1 2018, Morocco's Higher Planning Commission said on Wednesday.

Growth in the Q4 of 2018 was affected by the slowdown in added value, excluding agricultural activity, by 2.6 percent, compared with 3.4 percent during the same period of 2017.

The Commission said on its website that the agricultural sector grew 3.4 percent in Q4 of last year, compared to 4.1 percent during the first three quarters. This slowdown is partly due to the decline in livestock production.

Manufacturing growth in the last quarter of 2018, according to published estimates, also slowed to 2.8 percent from 3.2 percent in the same period a year earlier, as food industries slowed and demand for building materials fell.

However, chemical industry maintained its "dynamism" and grew 6.1 percent, and the added value of the textile and leather sectors increased 5.8 percent with the increase for the external demand for these products.

Mechanical and electronic industries grew 3.6 percent supported by demand from the automotive industry, stated the report.

Morocco's exports in the fourth quarter of 2018 increased 5.1 percent, thanks to higher sales in the aviation and automobile sectors, which contributed 80 percent to the growth rate of exports.

Food, clothing and electronics sectors contributed to a 0.9, 0.6 and 0.5 percent growth, respectively, as external demand for these products increased.

Imports recorded a 5.8 percent rate higher than exports, as the country was affected by the rise in global fuel prices, which contributed 2.2 points to import growth. In contrast, imports of foodstuffs, precisely wheat and sugar, declined during that period.

Industrial investment slowed in Q4, which was reflected on imports of processing materials that only increased 2.1 percent, compared to an 11 percent increase in the previous quarter.

Investment in construction was modest, with weak demand for housing, especially medium and high, stated the report.

For the first quarter of 2019, the Commission said that the expected slowdown will come from a decline in agricultural added value, estimated at 0.7 percent, although livestock production will see some improvement compared to the end of 2018.

“Overall, the non-agriculture added value is expected to record a 2.9 percent increase, according to the annual change.”



Gold Firms; Focus on US Data for Cues on Fed's Policy Path

FILE PHOTO: A woman looks at a gold bangle inside a jewellery showroom at a market in Mumbai January 15, 2015. REUTERS/Shailesh Andrade//File Photo
FILE PHOTO: A woman looks at a gold bangle inside a jewellery showroom at a market in Mumbai January 15, 2015. REUTERS/Shailesh Andrade//File Photo
TT

Gold Firms; Focus on US Data for Cues on Fed's Policy Path

FILE PHOTO: A woman looks at a gold bangle inside a jewellery showroom at a market in Mumbai January 15, 2015. REUTERS/Shailesh Andrade//File Photo
FILE PHOTO: A woman looks at a gold bangle inside a jewellery showroom at a market in Mumbai January 15, 2015. REUTERS/Shailesh Andrade//File Photo

Gold prices hovered near a four-week peak on Thursday, while focus shifted to jobs report due on Friday for clarity on the Federal Reserve's 2025 interest rate path.
Spot gold edged 0.1% higher to $2,664.30 per ounce, as of 0732 GMT. US gold futures rose 0.4% to $2,681.80
"Prices are trading in a narrow range ... A new trigger is needed for gold to breach its resistance," said Ajay Kedia, director at Kedia Commodities in Mumbai.
The bullion hit a near four-week high in the previous session after a weaker-than-expected US private employment report hinted that the Fed may be less cautious about easing rates this year.
The market now awaits US jobs report on Friday for more cues on the Fed's policy path.
Investors are also awaiting Donald Trump to take office on Jan. 20 and his proposed tariffs and protectionist policies are expected to fuel inflation.
Policymakers at the Fed's last meeting also "noted that recent higher-than-expected readings on inflation, and the effects of potential changes in trade and immigration policy, suggested that the process could take longer than previously anticipated," the minutes showed on Wednesday.
Bullion is considered an inflationary hedge, but high rates reduce the non-yielding asset's allure.
"We believe the bulk of the rally has been put in and that while gold's upward momentum may carry it higher in the near term and in early 2025, a combination of physical and financial market factors may tame the rally and drive gold moderately lower by the end of next year," HSBC said in a note.
Elsewhere, physically-backed gold exchange-traded funds (ETFs) registered their first inflow in four years, the World Gold Council said.
Spot silver added 0.2% to $30.17 per ounce, platinum dropped 0.3% to $952.54 and palladium shed 0.8% to $921.37.