Efficiency of Monetary policy after the Adoption of Inflation Targeting: The Case of Bank Al-Maghreb

Efficacité de la Politique Monétaire après l'adoption du ciblage d'inflation: Cas de Bank-Al Maghreb

Ahmed Hefnaoui and Ibnouzahir Youssef ()
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Ahmed Hefnaoui: Faculté des Sciences Juridiques Economiques et Sociales Mohammedia, Université Hassan II de Casablanca
Ibnouzahir Youssef: Faculté des Sciences Juridiques Economiques et Sociales Mohammedia, Université Hassan II de Casablanca

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Abstract: This study assesses the effectiveness of Morocco's monetary policy following the adoption of inflation targeting in 2006. The objective is to evaluate whether this strategy has stabilized inflation and supported economic growth. The methodology is based on a VAR model using quarterly data from 2007 to 2023, with Granger causality tests and impulse response functions to capture the simultaneous effects between monetary variables. The results indicate that inflation in Morocco is driven by shocks to the exchange rate and money supply, while the effect of the policy rate remains limited. Although monetary interventions have short-term effectiveness, their moderate impact suggests the need for structural reforms to enhance inflation targeting efficiency.

Keywords: Inflation; Inflation targeting; Monetary policy; VAR model; Policy rate; Ciblage d'inflation; Politique monétaire; Modèle VAR; Taux directeur (search for similar items in EconPapers)
Date: 2024-10
New Economics Papers: this item is included in nep-ara, nep-ban, nep-cba and nep-mon
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Published in African Scientific Journal, 2024, ⟨10.5281/zenodo.13918718⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-04737587

DOI: 10.5281/zenodo.13918718

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