Morocco’s Treasury exceeded its issuance target for January, raising a total of MAD 18.3 billion (US$2 billion), roughly 20 percent higher than the MAD 15.3 billion (US$1.67 billion) initially projected, according to Attijari Global Research (AGR)https://www.attijariwafabank.com/en/brands-and-Moroccan-subsidiaries/attijari-global-research.
The final auction of the month was marked by rising yields, reflecting a more cautious investment environment and broader repricing of sovereign debt. Yields on two-year government bonds rose by 22 basis points in the primary market, which deals with new issues directly from the Treasury, signaling higher borrowing costs for short-term debt.
On the secondary market, where existing bonds are traded among investors, yields increased by eight basis points across all maturities, suggesting that the adjustment was broad-based rather than concentrated in a specific segment of the yield curve. AGR said the simultaneous upward movement in both markets indicates a general reassessment by investors of the returns they require from holding Moroccan government debt.
“This repricing does not reflect doubts about Morocco’s ability to service its debt,” AGR noted, “but rather a more cautious investment climate, influenced by tighter banking liquidity and uncertainty surrounding future monetary policy.”
Investor appetite during the final January auction remained heavily focused on short-term instruments. Total demand reached MAD 6.6 billion (US$719.4 million), with more than three-quarters directed toward two-year maturities. The Treasury accepted MAD 4.8 billion (US$523.2 million), roughly 73% of expressed demand, reflecting a selective approach to allocation.
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The stronger-than-expected issuance highlights the Moroccan Treasury’s ability to mobilise funding despite a rising-yield environment. AGR analysts said the government’s robust cash position provides sufficient flexibility to manage both issuance volumes and the pace of supply on the primary market throughout the first quarter of 2026.
Rising yields in Morocco follow a regional trend as investors adjust to evolving global and domestic conditions. Central bank policy, liquidity management, and market sentiment have all contributed to higher short-term rates, affecting borrowing costs for governments across North Africa.
Analysts said that while the increase in yields raises the cost of new debt, it also signals healthy market demand for Moroccan government securities. The Treasury’s capacity to raise funding above target, even amid tighter conditions, reflects investor confidence in Morocco’s fiscal management and the government’s repayment capacity.
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The January issuance round was part of the Treasury’s ongoing strategy to manage public debt and ensure adequate liquidity for government operations. AGR highlighted that Morocco’s selective retention of bonds allowed it to match supply with investor demand while limiting excessive exposure to short-term refinancing risks.
Looking ahead, market watchers said the Treasury will likely continue issuing bonds in a controlled manner, balancing the need to fund government operations with the goal of maintaining manageable borrowing costs. Analysts expect that upcoming auctions in the first quarter of 2026 will continue to attract strong interest from both domestic and international investors, particularly for short-term maturities.
The performance of the Moroccan Treasury in January demonstrates the government’s ability to navigate a shifting financial landscape, maintaining access to capital while adjusting to higher yields. Observers say that monitoring monetary policy, liquidity conditions, and investor sentiment will remain key to understanding developments in Morocco’s sovereign debt market in the months ahead.
