The Bangladesh Bank is set to announce its monetary policy statement for the first half (July–December) of the 2025–26 fiscal year, reaffirming its tight monetary stance aimed at bringing down inflation to 6.5 per cent by June 2026.
The central bank’s board of directors is expected to approve the policy today, and the full statement will be unveiled at a press conference tomorrow, officials said.
They confirmed that the policy will maintain most of the current measures, continuing a restrictive approach to curb inflationary pressures.
The policy interest rate, or repo rate, will remain unchanged at 10 per cent, while the private sector credit growth target is set at 9 per cent.
A report titled Monetary Policy Review–FY25, published on Monday, stated that the real policy rate has remained positive since January 2025, contributing to inflation containment.
It projected that inflation will fall to 6.5 per cent in the 2025–26 fiscal year.
The report added that easing inflationary pressure is expected to revive domestic demand and support the government’s GDP growth target of 5.5 per cent for FY26, bolstered by ongoing structural and economic reforms.
While Bangladesh’s external sector has performed strongly in recent months — supported by rising exports, remittances, and exchange rate stability — the report warned of persistent risks from global trade tensions and geopolitical instability.
To prioritise inflation control, Bangladesh Bank pursued a tight monetary policy throughout FY25.
During the first half (July–December, 2024), the policy rate was raised by 50 basis points each, from 8.5 per cent to 10 per cent.
The central bank then opted to maintain this 10 per cent rate in the second half (January–June 2025), citing sustained inflationary pressure.
The bank believes that keeping the rate steady through the second half of FY25 was prudent for anchoring inflation expectations and avoiding a rebound in price levels.
Headline inflation fell to 8.48 per cent in June 2025, the lowest level since February 2023, down from 9.05 per cent in May.
Despite remaining elevated, the trend marks a gradual improvement. The external sector has shown resilience.
Between July 2024 and May 2025, the current account deficit narrowed sharply to $0.43 billion, down from $6.12 billion in the same period of the previous year.
This was driven largely by a 28.7 per cent rise in remittance inflows.
Additionally, the overall balance of payments deficit declined to $1.15 billion during this period, compared with $5.89 billion the year before.
The exchange rate of the Bangladeshi taka against the US dollar depreciated by 3.94 per cent over the fiscal year ending June 2025.
This limited depreciation reflects growing stability under the market-based exchange rate regime introduced earlier this year.
