The USD/MAD appreciated this week by +1.05% from 9.88 to 9.99. The Dollar thus appreciated for the 3rd consecutive week to reach a high since the end of last June.

This is due to a double positive effect, i.e. a basket effect of +0.72% related to the increase of the Dollar this week and a liquidity effect of +0.33%.
Liquidity spreads have been back in positive territory for 2 weeks. This trend is explained by import flows getting more important than export flows due to the  near end of the summer period.

Given the end of the summer period, we anticipate a depreciation of the MAD on a ST horizon. Tensions on
the liquidity of the Dirham could put pressure on the domestic currency during the next 3 months.
We recommend that importers hedge over a horizon of between 1 month and 3 months.

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