Speculations About Dirham Devaluation Overblown BMI Research

admin djjpct , , , , ,

Rabat – BMI Research is pinning the blame for the delay of the dirham liberalization reform on commercial banks. In its latest report, the Fitch Group company stresses that far from the devaluation speculations, the Moroccan dirham is set to sail on a “smooth and gradual transition towards a free float.”The Moroccan dirham has been the star of local news these past months. Amid talks about a currency liberalization reform, speculations about a sharp depreciation of the dirham have run wild. Despite the constant reassurance of Bank Al-Maghrib, which presented proof of a strong economic fundamentals able to sustain a flexible exchange rate, the mistrust of commercial banks resulted in a rush on currency, draining Morocco’s foreign reserves starting in April 2017.Also Read: All You Should Know About ‘Floating Dirham’In its economic analysis, entitled “Fears Of Disorderly Depreciation Overblown,” BMI Research stresses the risks of speculation facing the planned reform, and its dire consequences. Not only were the Moroccan authorities forced to delay the first phase of the dirham liberalization reform due to these unfounded fears,  the ensuing panic also sparked a “sharp fall in foreign reserves since April 2017.” Between April and June, “reserves fell by 12.4 percent, from USD 24.4 billion to USD 21.4 billion, before stabilising in late July,” notes the company, adding that fears that the perpetuation of this rush on currency would case a further drop in reserves pushed authorities to completely delay the reform for the time being.Sparked by fears of a similar scenario to that of Egypt, the speculations could have serious consequences, according to BMI Research, which states that “a significant loss of reserves would have impaired the central bank’s ability to manage the dirham after allowing greater [fluctuation bonds].”However, the delay of the reform and the drawdown in net international reserves “does not affect BMI’s confident outlook for Morocco to successfully undertake a gradual transition towards a more flexible exchange rate regime.”For BMI Research, the Moroccan central bank has been successful at managing the Dirham peg over the past few years, backed by “the robustness of the Moroccan economy and positive investor sentiment, sharply contrasting with other North African economies which have been forced to allow their currencies to depreciate against their respective baskets.”These factors, combined with a real effective exchange rate broadly in line with its 10-year average, suggest that the currency is not particularly overvalued, and BMI Research “maintains its view that Morocco is in a favourable position to gradually move towards a more flexible exchange rate.”The company stresses that with the Moroccan authorities set to allow only modest fluctuations over the coming months, it sees “limited risks stemming from the liberalisation of the exchange rate regime.”Not only are speculations about a possible sharp devaluation unfounded, according to BMI, on the contrary, the dirham liberalization reform is set to boost the Moroccan economy.“Greater exchange rate flexibility will enable the Moroccan government to further reduce capital controls, which will enhance Morocco’s status as the preferred investor destination in North Africa,” explains the report.The reform is “also consistent with Morocco’s ambitions to increase trade links with African economies, in an effort to become a manufacturing and exporting hub between Europe and Africa.”“A reduced dependence of the dirham to the euro’s fate will increase flexibility and reliance to external shocks,” concludes BMI.

You May Also Like..

‘There is still bread with justice’

first_imgDespite challenges faced by working class…– Govt in May Day messageIn Guyana, though sections of the working class face challenges, there is still bread with justice. There are no lines for basic items, no riots for food and no spectre of violence against protestors. These are the sentiments expressed by the Guyana Government in its May Day message to Guyanese workers and their colleagues across the world.Following is the full text of the May Day message from the Guyana Government:The Government of Guyana extends May Day greetings and solidarity to Guyanese workers and their colleagues across the world.May Day comes this year with workers in several countries, including highly developed countries, fighting not only against big business but combatting fears of anti-worker and anti-immigrant administrations controlling state policies.Elsewhere, workers and their families are victims of wars, armed conflict, terrorism and threats of nuclear attacks. Millions of able-bodied persons have been rendered jobless, homeless and driven to the edge of starvation. In many countries, including neighbouring states, there is social turmoil and workers face an uncertain future.Our Coalition Government is rooted in a labour tradition and continues to identify with the broader vision of the Guyanese working people for racial and national unity, a stronger, vibrant and purposeful labour movement, defense of our nation’s sovereignty and realising the good life for all Guyanese.In Guyana, though sections of the working class face challenges, there is still bread with justice. There are no lines for basic items, no riots for food and no spectre of violence against protestors.On this May Day 2017 our Coalition Government urges all working people to maintain the partnerships with business and the state and to help realise the national goals of building a stronger economy, creating new jobs and distributing greater benefits to workers and their families. The Government of Guyana hopes that you enjoy May Day and use the occasion to reinforce your platform for better conditions of life.last_img

PM, AG engaging in “juvenile antics” – Nandlall

first_imgCarvil Duncan trial…accuses them of trying to convert judge from “victim to villain”Less than 24 hours after Prime Minister Moses Nagamootoo requested that High Court Justice Franklyn Holder recuse himself from the Carvil Duncan case, former Attorney General (AG) Anil Nandlall has described the move as a plot that in effect “undermines” the tenets of democracy. In a letter to the judge, the Prime Minister asked him to remove himself from the case in light of the brewing tension with current AG Basil Williams over an incident at the last hearing back in March. But Nandlall, in a social media post on Sunday afternoon, pondered if he was now living in a “surreal world”, and even categorised the Prime Minister’s letter as a “scheme” formulated with the AG’s assistance to ensure that Williams does not apologise to the judge.“This letter is nothing short of a most comical and clumsy conspiracy hatched between the AG and the Prime Minister to avoid the AG apologising to Justice Franklyn Holder. As a lawyer, he (the PM) should have never lent himself to such a sleazy and senseless scheme. Imagine, the PM is asking the judge to recuse himself from the case essentially because the judge did not cite and jail the AG for contempt… Only intellectual giants like Williams and Nagamootoo can conceive such a “sophisticated” plot,” the former Legal Affairs Minister said is his strongly worded online post. It has further been claimed that the PM’s letter seeks to villainise the judge who, according to Nandlall, has been a victim of abuse. “It is that factual matrix which produces this bizarre letter which seeks to convert the judge, who is the victim of the abuse, into the villain! This can happen in no civilized country where there is rule of law and a system of democracy,” Nandlall expressed.Nandlall has also highlighted that the principle of separation of powers may be under threat. “These are two of the most senior functionaries of this Administration engaging in juvenile antics about a crucial state institution like the Judiciary…they now want to choose their own judge to hear their own case; [this is] a classic exhibition of authoritarianism. [It strikes] at the heart of the doctrine of separation of powers. Imagine if every litigant, on his own volition, decides to abuse the judge hearing his case and then claim the judge is biased…the Judiciary may not be able to sanction anyone for disrespecting its officers and processes in the future without being accused of hypocrisy and bias,” the former Attorney General pointed out.Duncan has moved to the court to block the work of a presidential tribunal set up to determine whether he should be removed from his post as Chairman of the Public Service Commission (PSC) in light of criminal charges proffered against him, one of which has since been dismissed at the Magistrate’s Court.Justice Holder complained to acting Chancellor, Yonette Cummings-Edwards, that during the March 23rd hearing of that case, he abruptly walked out of the courtroom as a result of statements made by the Attorney General.He quoted the AG as saying, “I could say what I want to say and however I want to say it, I have always been like that… The last magistrate who (told me what to do) was later found dead.”Justice Holder said in his complaint that he felt disrespected by the Attorney General’s behaviour, and he has called for an apology to be given him in open court before proceeding further with the case.However, the State’s chief legal advisor is holding out that he is not to be blamed for causing the High Court judge to walk out of the courtroom. He has also insisted that his comment was not a threat, even though Duncan’s defence lawyer, Anil Nandlall, has described it as such.In a letter dated May 4, 2017 and addressed to the Attorney General, Prime Minister Nagamootoo raised concerns about having a fair trial in light of the incident. “…due to an alleged incident between yourself and Justice Franklyn Holder in his Honour’s court on March 23, 2017 in the above mentioned suit, and His Honour’s subsequent petition to the Honourable Chancellor against the Attorney General on the issue of the alleged incident, I am of the opinion that neither the State nor I will receive fair hearing in the matter…,” the Prime Minister had stated.“Based on all the above mentioned grounds, I am of the opinion that I would be prejudiced in the suit because my attorney is barred from being heard in the matter. In view of the foregoing, therefore, I authorise you to request that the Honourable Mr Justice Holder recuse himself from further hearing the matter.”A copy of the petition has been forwarded to both the Chancellor of the Judiciary and Chief Justice, as well as President David Granger. However, the Office of the Chancellor had revealed that despite calling on AG Williams to officially explain his conduct, he is yet to respond.The continuation of the Carvil Duncan trial is scheduled for today (May 8).last_img

Rats have run of eatery

first_imgNEW YORK – New Yorkers are used to seeing rats where they catch their trains – not where they buy their burritos. About a dozen rats were having a grand party Friday in a locked KFC/Taco Bell restaurant, scampering around the floor, playing with each other and sniffing for food as they dashed around tables and children’s high chairs. Onlookers could not keep their eyes away from the jaw-dropping sight – a gang of urban vermin invading a restaurant that had been taking people’s chicken and taco orders just a day earlier. Video of the rats was seen around the world, disseminated on TV stations and the Internet. “All you can eat once the store is locked,” one onlooker joked. 160Want local news?Sign up for the Localist and stay informed Something went wrong. Please try again.subscribeCongratulations! You’re all set! “They should handcuff them and throw the dirty rats in jail,” cabbie Wilson Paul said as he pulled over to gawk. Word spread after a TV crew discovered the rat infestation Friday morning and filmed it through a window of the Greenwich Village building. Health inspectors arrived, and the parent company for KFC and Taco Bell, Yum Brands, Inc., was again forced into damage-control mode a few months after enduring an E. coli outbreak. The restaurant was not open when the rats were spotted. The company said construction in the basement Thursday appeared to have stirred up the rodents. “This is completely unacceptable and is an absolute violation of our high standards,” Yum Brands said in a statement.last_img

Leave a Reply

Your email address will not be published. Required fields are marked *