Inflation, currency prime focus of BB’s next monetary policy

The Bangladesh Bank (BB) will announce its next monetary policy on Wednesday for the second half of the fiscal year 2023-24 to tame inflation and ease exchange rate pressure.

As part of the preparation, the draft of the monetary policy was approved at the central bank board meeting on Sunday.

Officials who attended the meeting told UNB that the exchange rates would not be based on real markets in the upcoming monetary policy as the foreign exchange market is not stable yet.

The government policymakers have instructed to keep the market under control by following the crawling peg system.

“Crawling pegs help control currency movement, especially when there are threats of devaluation. The purpose of crawling pegs is to provide stability,” said a BB official involved in the preparation of the monetary policy statement.

The monetary policy will focus on controlling the growing inflation, which has been a burning issue over the last eight months.

Economist and co-founder of PRI Dr Sadiq Ahmed, Director General of the Bangladesh Institute of Development Research (BIDS) Binayak Sen, and Chairman of the Economics Department of the Dhaka University Masuda Yasmin are on the monetary policy committee.