Bangladesh Bank will announce monetary policy today

Amid multifaceted crisis in the banking sector, Bangladesh Bank is going to announce the monetary policy for the second half of the current financial year (January-June) today. Although Bangladesh Bank announced a 12-month monetary policy at the beginning of the financial year. Now Bangladesh Bank is re-introducing monetary policy in the middle of their terms while taking debt from International Monetary Fund (IMF).

It is known that Bangladesh Bank will follow the path of contractionary monetary policy to keep inflation under control. However, there will also be some initiatives to mitigate the environment created by the dollar crisis, liquidity crisis, inflationary pressures and 'real' private sector credit growth below target.

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Governor Abdur Rauf Talukder will announce this monetary policy today at 2.30 pm at Bangladesh Bank's head office in Motijheel, Dhaka. This is his first monetary policy announcement as governor. The main objective of monetary policy is to support the implementation of the national budget of the government and to keep inflation under control. Although Bangladesh Bank has not said anything directly about this year's monetary policy, according to related sources, Bangladesh Bank will announce a contractionary monetary policy for the second half of the fiscal year, taking into account the overall situation of the country. There will be efforts to control inflation and reduce the fountain of credit in the private sector. Except this exchange rate is market based. Bangladesh Bank is not going to release the interest rate of the loan to the market, despite its efforts.

Since 2006, the monetary policy has been announced twice a year, but from 2019, former Fazle Kabir announced the formulation of monetary policy once a year. Accordingly, he announced the monetary policy for the fiscal year 2019-20 on July 31 of that year only once. Later, Bangladesh Bank announced the monetary policy only once in the fiscal year 2020-21 and 2021-22.

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However, recently the International Monetary Fund (IMF) advised to announce monetary policy four times a year as a condition of the $4.5 billion loan. But Bangladesh Bank is currently in favor of doing monetary policy twice a year. As part of this, the monetary policy for the second half of the financial year is being announced today on January 15.