Written by The Banking Post
Economists and market stakeholders have urged the Bangladesh Bank to keep the policy rate unchanged at 10 per cent, citing persistent inflationary pressures and the need for monetary stability.
The recommendation came during a monetary policy consultation meeting held on Wednesday at the central bank, with participation from business leaders, economists and senior officials.
Participants said inflation, still running above 9 per cent, leaves little room for policy manoeuvre. A rate hike, they warned, would push up borrowing costs and further strain investment and credit growth, while a rate cut could risk fuelling price pressures.
“Many felt a rate hike is unnecessary at this stage, but cutting the policy rate would also be inappropriate given the inflation outlook,” said one participant.
Several attendees argued that keeping the policy rate steady would help anchor inflation expectations without adding pressure on businesses or disrupting credit flows.
The policy rate serves as the benchmark interest rate, guiding banks’ lending and deposit rates across the financial system.
The meeting also flagged broader economic challenges, including rising non-performing loans in the banking sector and ongoing liquidity constraints, underscoring the need for a cautious and balanced monetary stance in the coming months.
