By: Navalsang Parmar/Akashwani News/Dhaka
The Bangladesh Bank has revised down Bangladesh’s economic growth target to 6.5 percent from 7.5 percent for the fiscal year 2023-24. While unveiling Bangladesh Bank’s monetary policy statement (MPS), its Governor Abdur Rouf Talukder on Wednesday said in Dhaka that Bangladesh’s economic outlook remains positive amid the economic challenges.
However, the Bangladesh Bank’s growth target revision came after the International Monetary Fund (IMF) revised down growth forecast for Bangladesh’s economy to 6 percent from previous projection of 6.5 for the fiscal year 2023-24.
With the statement, the Bangladesh Bank has also increased its policy rate by 25 basis points to 8.0 per cent as part of its inflation-combating steps for the second half of the financial year 2023–24.
However, the central bank earlier said they had taken enough measures to tame inflation at 8% by December, the latest data from the Bangladesh Bureau of Statistics shows that inflation stood at 9.41% in the month.
Talukder said that the dynamic fuel prices amidst instability in the Middle East, volatilities in prices of essential commodities in global markets, reducing inflation at a tolerable level, stressed forex and non performing loans are the major challenges for the economy.
The central bank adopting a contractionary monetary policy stance also lowered the target for private sector credit growth to 10 per cent from 11 per cent.
The Bangladesh Bank also announced the introduction of a new exchange rate mechanism named the crawling peg. It is a system of exchange rate adjustments in which a currency with a fixed exchange rate is allowed to fluctuate within a band of rates.