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Bangladesh Bank declares ÔÇ£growth-friendlyÔÇØ monetary policy

Staff Correspondent |
Update: 2010-07-18 19:52:15
Bangladesh Bank declares ÔÇ£growth-friendlyÔÇØ monetary policy

DHAKA: The central bank Monday unveiled a “growth-friendly” new monetary policy aiming to help the country attain faster economic growth containing the upward inflation within tolerable levels at the same time.
 
Bangladesh Bank Governor Dr. Atiur Rahman declared the monetary policy at a press meet in the BB conference room in the afternoon and explained its aims and objectives.

The governor said the pressures of inflation would be monitored round the clock over the next six months. “Bangladesh Bank will take all possible initiatives to contain the inflation,” he said.

Atiur Rahman urged the citizens to create public opinion in reducing spending in unproductive sectors like luxuries and also exercising austerity in usage of scarce fuels as the country feels energy crunch.

The central bank chief said, “High remittance inflow can spur the inflation. Besides, a new pressure can be created on the inflation from the pressure of RMG workers demanding increase in salary.”

He said the average rate of inflation would remain within 6.5 percent in the current fiscal under the declared monetary policy and the pressure of inflation would be at tolerable levels if any massive natural and social disasters do not occur.  

Replying to a query, the Governor said, “Bangladesh is in a better position than neighbouring India to face the inflation. But, despite staying in a better poison, the double-digit inflation of India is a matter of concern for Bangladesh due to legal and illegal trade.”

The monetary policy declared in April last showed an average 8.54 percent inflation on point-to-point basis, with 10.47 percent in food sector and 5.46 in other sectors.   

The policy recommends supplying power at a subsidized price in order to keep the domestic expenditure at an affordable level.  

Replying to another question, the BB Governor said, “ Bangladesh Bank did not place proposal for increasing the power price. The power sector will leave an impact on the inflation no matter whether the price of power increases or goes down.”

BDST: 07:00 HRS, JULY 19, 2010.

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