Morocco's central bank adjusts currency peg due to weaker euro

LONDON (ShareCast) - The euro's weakness against the US dollar triggered Morocco's central bank to adjust the country's dirham peg on Monday. The central bank, Bank Al-Maghrib, changed the currency basket weightings it uses to set the dirham's exchange rate to 60% for the euro and 40% for the dollar, reducing the euro's weighting due to changes in trade. Previously, the central bank gave the euro a weighting of 80% and the dollar 20%.

It is the first change in Morocco's currency basket in a decade and follows an increase in trade with the US, China and the rest of Africa, and a fall in trade with the Eurozone.

It's a "first step in the transition toward a more flexible exchange regime aimed at strengthening competitiveness of the country and resilience of its economy to external shocks," said Bank Al-Maghrib said in a statement.