The central bank will unveil the monetary policy for the first half (H1) of 2024-2025 on July 18 by publishing it on its website, breaking the tradition of announcing it through a formal press conference.
This unprecedented move aims at making the policy statement more accessible and transparent said Saiful Islam, the central bank Executive Director and acting spokesperson.
However journalists believe that the shift in unveiling the policy results from boycott of the central bank events by reporters of the print and electronic media in protest of denying access of reporters to the central bank allegedly to conceal their irregularities.
The sources said the primary goal of the upcoming monetary policy this time will be to control inflation, which has been a pressing issue for the economy.
In the first half of FY24, the central bank focused on tightening the money supply to curb rising prices. Interest rates were increased, and liquidity was reduced to slow consumer spending and investment, thereby reducing demand-pull inflation. These measures had a mixed impact, with inflation showing some signs of moderation but not to the desired extent.
For first half (H1) of the running fiscal (H1FY25), the central bank is expected to continue its tight monetary stance. Given the persistent inflationary pressures, further interest rate hikes are likely.
Additionally, the central bank might implement stricter reserve requirements for commercial banks to control money supply more effectively. Ensuring price stability will be crucial central in the upcoming policy to maintaining economic growth and protecting consumers purchasing power.
Experts suggest the central bank should also focus on structural reforms to address supply-side constraints contributing to inflation. Enhancing agricultural productivity, improving supply chain efficiencies, and reducing import dependency for essential goods can help stabilize prices in the long term.
Another vital area is managing inflation expectations through effective communication and policy transparency.
Commenting on the need for robust policies in times of high inflation, economic analyst Ayesha Rahman emphasized that the central bank must adopt a multifaceted approach. She highlighted the importance of coordinating with fiscal authorities to ensure a comprehensive strategy that includes both monetary and fiscal measures.
Economist Rafiq Ahmed pointed out that a proactive stance on monetary policy is crucial, but it must be balanced with measures that support economic growth and employment.
The central banks decision to publish the monetary policy online reflects a shift towards greater openness and accountability. The Bangladesh Bank officials say this approach will allow a wider audience to access and understand the policy framework, fostering better-informed economic decisions.
As the central bank prepares to announce its policy measures for H1FY25, all eyes will be on how it plans to tackle inflation while supporting sustainable economic development, a banker working in a private bank said.
