A new monetary law is coming to increase investment and will be declared next week. Bangladesh Bank governor, Fazle Kabir, will unveil the new currency policy in the second phase of 2018-19 fiscal year.
Bangladesh Bank spokesperson Sirajul Islam, told Bangla Tribune, “The work to formulate monetary policy is almost over and will be declared at the end of next week.”
Central bank sources say that keeping 8 percent GDP in mind, the new growth inducing monetary policy will be formulated with the objective of keeping inflation within 4 percent.
In the 2018-19 fiscal year, the targeted GDP has been set at 7.8 percent, which was 7.4 percent in 2017-18.
There is a belief that GDP will go beyond 8 percent in 2018-19.
A central bank official told Bangla Tribune, “Through the new monetary policy, there will be efforts to increase liquidity in the banks which will eventually bring down interest rate over loans.”
The currency plan will aim to tackle the long term slump in investment, he commented.
Meanwhile, as per the latest report of the Bangladesh Bureau of Statistics, BBS, the general point to point based inflation has been 5.37 percent.
It’s believed that the draft of the monetary policy will be placed at the next executive meeting of the central bank to be held either on 26 or 27 January.
After its approval, the policy will be declared.
Till last December, growth in loan has been 13.20 percent, lowest in 39 months. This was due to lack of encouraging investment in 2015.
Former adviser to the caretaker government, Dr AB Mirza Azizul Islam, told Bangla Tribune, “Monetary policy does not have a leading role in raising investment; however, private entrepreneurs have an expectation from the government to raise investment.”
Bangladesh Bank formulates and launches monetary policy twice every year, one at the beginning of the fiscal year, in July, and the other, in January.
The policy projects currency movement and one of its main objectives is to control inflation.