Bank Al-Maghrib: Money Supply Grows by 7.4% in October

The recent report from Bank Al-Maghrib indicates that the money supply, measured by the M3 aggregate, grew by 7.4% in October. This increase is primarily attributed to a combination of factors, including a slowdown in net claims on the central administration, which decreased from 1.4% to 0.3%, and an acceleration in bank credit growth to the non-financial sector, rising from 3% to 3.6%. Additionally, official reserve assets saw a significant increase, with growth climbing from 14.1% to 19.6%. The annual growth of the M3 money supply reflects a deceleration in holdings of money market mutual fund shares, which fell from 24.1% to 9.1%. Conversely, the growth rate of currency in circulation accelerated from 9.8% to 11.7%. There was also a rise in term accounts by 1.4%, following a decline of 1.1% the previous month. Meanwhile, the growth of sight deposits at banks remained nearly stagnant at 10.2%, and savings accounts grew by 1.9%. In terms of bank credit to the non-financial sector, there was an increase in loans to private non-financial companies, which grew by 1.4% compared to 0.8% previously. Loans to public non-financial companies accelerated to 11% from 6.4%. Household loans continued to grow at a stable rate, reaching 3.1% after 2.9%. By economic category, the year-on-year change in bank credit to the non-financial sector shows a reduction in the decline of cash facilities, which decreased to 4.8% from 6.6%. Consumer credit increased to 4.5% from 4.2%, while growth in equipment loans remained nearly unchanged at 16.4%, and real estate loans grew by 3.2%. Regarding institutional sectors, the growth of monetary assets, excluding currency in circulation, showed a near stagnation in the growth of household monetary assets at 6.5%. This includes stable growth in sight deposits at 9.3% and savings accounts at 1.9%, alongside an intensified decline in term accounts, which fell from 3.8% to 4.4%. In contrast, the monetary assets of private non-financial companies increased by 10.8% after a previous growth of 10.3%, linked to an acceleration in sight deposit growth, a reduction in the decline of term deposits, and a slowdown in their holdings of money market mutual fund shares. Meanwhile, the growth of monetary assets for public non-financial companies decelerated due to a slowdown in the growth of both sight and term deposits. As for non-performing loans, their year-on-year growth showed a near stagnation at 3.7%, with the ratio of non-performing loans to total credit remaining unchanged at 8.6% compared to the previous month.