As inflation has not reached the desired low level, the central bank is going to announce the new half yearly monetary policy for July-December for 2025-26 on January 29 keeping the policy interest rate unchanged.
Bangladesh Bank Governor Dr. Ahsan H. Mansur will announce a conservative monetary policy. According to Bangladesh Bank sources, the contractionary policy will be maintained to keep money supply restricted until inflation easers at 7 percent.
Bangladesh Bank announces its monetary policy stance every six month. Tee six month policy will provide an outline how money supply will be restrained while achieving the higher GDP growth targets. The policy interest rate is used as one of the tools to increase or decrease the money supply.
The policy rate remained unchanged at 10 percent since October 2024. In order to control inflation, which has been in double digits for a long time, the rate was increased by 150 basis points to 10 percent in three phases in two months.
In November 2024 after the fall of the Awami League government the point-to-point inflation was at its highest at 11.38 percent. However, it gradually decreased from the next month to 8.17 percent in October. From there, it increased again to 8.29 percent in November and further increased to 8.49 percent in December. Concerned people said dollar rate has been stable at Tk122 for a long time amid booming remittance. There is no problem in getting dollars now. A recent study by the central bank on increase in prices of five daily necessities, including rice, has revealed various reasons.
The biggest reason has been identified as weakness in market management and the increased interest of farmers in cultivating other crops than rice due to higher profits. Due to which rice production has decreased.
In the last monetary policy, Bangladesh Bank estimated the credit growth in private sector at 7.2 percent until next December. However, 6.58 percent was achieved until last November.
Those concerned said it will remain around 6.50 percent in December as well. However, the central bank believes demand for credit in the private sector will increase after election, cutting stagnation in investment.
In such a situation, the estimate of credit growth in private sector by next June is being kept unchanged at 8 percent.
In last monetary policy, estimate of public sector credit growth by December was estimated at 20.40 percent and by next June at 18.10 percent.
