Unveiling its monetary policy for the first half (H2, July-December) of FY27, Bangladesh Bank yesterday kept the policy (repo) rate unchanged at 10 per cent to tackle inflationary pressures.
Overall inflation is likely to stay well above the central bank’s target of 7 per cent at the end of June.
The central bank has set a 7.5-per cent inflation ceiling and targets 6.5 per cent GDP growth for FY27.
Overall inflation is likely to stay well above the central bank’s target of 7 per cent at the end of June.
This would mark at least the sixth consecutive year that inflation has exceeded the central bank’s set target. In FY25, average inflation hit 10 percent, and it was 9.73 percent in June 2024.
Bangladesh Bank has set a 7.5-per cent inflation ceiling and targets 6.5-per cent gross domestic product (GDP) growth for FY27, aligning with the government budget, according to the monetary policy statement.
The economy faces a fragile recovery with elevated inflation, high non-performing loans and energy uncertainties, the central bank noted.
Monetary tightening alone cannot resolve structural inefficiencies, while Middle East tensions pose risks to supply chains, it cautioned.
Fibre2Fashion News Desk (DS)
