Experts urge cenbank to keep policy rate unchanged amid inflation concerns
The policy rate, set by the central bank, serves as the benchmark interest rate that influences banks’ lending and deposit rates.
Stakeholders and economists have advised the Bangladesh Bank to keep the policy rate unchanged at 10%, arguing that the current economic conditions warrant stability rather than further tightening or easing of monetary policy.
The view emerged at a monetary policy consultation meeting held yesterday at the Bangladesh Bank, attended by business leaders from various sectors, economists and senior central bank officials.
The policy rate, set by the central bank, serves as the benchmark interest rate that influences banks' lending and deposit rates.
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Participants said that with inflation remaining above 9%, raising the policy rate could further increase borrowing costs, while lowering it could risk fuelling price pressures.
Several attendees noted that maintaining the rate at its current level would help contain inflation without adding stress to investment and credit flows.
One participant told The Business Standard that many at the meeting felt a rate hike was unnecessary at this stage, but reducing the policy rate would also be inappropriate given persistent inflationary pressures.
The meeting also discussed broader economic challenges, including rising non-performing loans (NPLs) in the banking sector and liquidity condit ions.
