Inflation will go up further as oil prices increase: Finance Minister

Finance Minister AHM Mustafa Kamal has expressed the apprehension that inflation will go up further due to oil price hike in international market.

"Economy is closely associated with fuel oil. Prices of goods and services will increase if oil prices go up in international market. Its implication will fall on overall economy and living standard of people," he said while talking to journalists at his office at the Ministry of Finance on Wednesday.
The Finance Minister said, "The government is for all the people of the country. Poor people suffer most in such a situation. The government has introduced OMS and TCB's Family Cards to alleviate their sufferings. The government is also thinking about taking further measures for the poor. The decision will be taken after discussing with the prime minister."

Referring to the existing dollar crisis, the minister said, "Dollar rate is now in an unstable state everywhere in the world. Those who are engaged in war and who are provoking the war are facing the same consequences."

"We are trying to keep the foreign currency market stable," he added.

Replying to a query about the removal of treasury chiefs of six banks, Mustafa Kamal said, "There is a limit to keeping dollars at banks. If any bank holds dollars beyond the limit, it must have done so for illegal business purposes."

On August 8, the Bangladesh Bank ordered the removal of treasury chiefs of six banks after finding evidence against them of making higher profits in trading dollars.

The banks were Dutch Bangla Bank, BRAC Bank, City Bank, Prime Bank, and Southeast Bank and multinational bank Standard Chartered Bank.

Domestic inflation of the country is expected to peak in the short term (3rd quarter of 2022) and abate later towards the end of 2023 with the projected easing of global commodity prices, according to a finance ministry report.

The country faced a massive dollar crisis as remittance dwindled and imports increased in comparison to exports in the post-Covid period. The price of the dollar hit the record at Tk 119 in the open market today (August 10).

In the interbank currency market, the US dollar was being traded at Tk 95 on Monday.

To control the manipulation of dollars in the open market, till August 2, some 80 money changers were raided and show cause notices were served as irregularities were found in 42.

Bangladesh Bank also announced the suspension of five money changers' licenses.