The Bangladesh Bank will not be making any drastic policy changes ahead of the national election scheduled for January, putting all its focus on tackling the depleting foreign exchange reserves and refraining from printing money to give loans to the government.
The government’s borrowing from the banking system has remained in check so far in the ongoing fiscal year thanks to lower expenditures and higher revenue collection.
The Bangladesh Bank is going to take a raft of policy measures to tackle inflationary pressure, volatility in the foreign exchange market and growing non-performing loans (NPLs) and give a much-needed boost to the forex reserve.
A persistently higher inflation for more than a year has hit the low-income, the poor and the fixed-income people in Bangladesh hard, significantly eroding their purchasing power.
Although higher consumer prices have persisted in the first few months of the current fiscal year, inflation in Bangladesh is going to cool in the later part of 2023-24 thanks to one external and two domestic factors, the Asian Development Bank (ADB) forecast yesterday.
The government should have figured out how to rein in food inflation by now.
Inflation in Bangladesh fell slightly to 9.24 per cent in April, driven by a decline in food prices, although it still remains at an elevated level compared to historic trends, official figures showed yesterday.