Interaction between Monetary and Macroprudential Policies: A Semantic and Textual analysis of Moroccan Central Bank Communications

Résumé

Abstract:

The interaction between monetary policy and macroprudential policy is essential for maintaining financial stability, particularly in an emerging economy like Morocco. This study examines how the Central Bank of Morocco coordinates these two policies to enhance financial and economic stability. Effective coordination of monetary and macroprudential policies helps moderate credit booms and prevent asset bubbles. Thus, contributing to increased financial stability. Utilizing textual and semantic analysis methods, we systematically analyzed the press releases and institutional reports from Bank Al-Maghrib. Our results show that the Central Bank of Morocco has successfully aligned these policies effectively, confirming the hypothesis that coordination strengthens financial stability. The findings underscore the importance of policy coordination to maximize effectiveness and mitigate conflicting outcomes. Key terms such as “stability”, “coordination”, “inflation”, “monetary policy”, and “macroprudential policy” frequently appeared, indicating the central bank’s commitment to aligning these policies. However, conflicts can arise when the objectives of these policies diverge. The Central Bank of Morocco has implemented mechanisms to manage these conflicts, demonstrating its ability to adapt international best practices to its national context. A semantic analysis of the Central Bank’s press releases from 2018 to 2023 reveals a consistent focus on financial stability and an explicit recognition of the importance of policy coordination. Moroccan results are consistent with international studies advocating for close coordination between monetary and macroprudential policies. Moreover, our analysis revealed that Bank Al-Maghrib’s press releases are direct and transparent. The Moroccan central bank has shown adequate responsiveness to economic changes to maintain financial stability. In conclusion, our analysis confirms that Bank Al-Maghrib effectively coordinates monetary and macroprudential policies to enhance financial stability. This study highlights the need for ongoing research to further understand the complex dynamics between these policies, particularly in the Moroccan context.

Keywords: Stability; Coordination; Monetary policy; Macroprudential policy