• Saturday, May 08, 2021
  • Last Update : 03:26 pm

New monetary policy may focus on credit flow, investment

  • Published at 07:49 pm July 13th, 2014

Bangladesh Bank (BB) is preparing the new monetary policy statement (MPS) with special focus on some measures for increasing credit flow and spurring local and foreign investment.

The new MPS for the first half of the current 2014-15 financial year (FY15) would be announced later this month, reports BSS.

“There will be some measures to cut lending rate to create more demand for credit in the market,” a central bank official told BSS.

Accordingly, he said the interest on bank’s deposit would also be reduced to protect the interest of both the people and banking sector.

The central bank in its two past MPS kept private sector credit growth to 16.5 percent to manage inflation at a comfortable level, which had been soaring due to high food prices. The inflation at the end of June dropped to a 17-month low of 6.97, creating the scoop of credit expansion particularly to the productive sectors.

The central bank, however, would prefer small and medium enterprises and similar sectors for credit expansion so money circulation on the market would not increase from non-productive spending, the BB official said.

Besides, the central bank is expecting that the current trend of export and import would also help increase credit flow to private sector in the coming days.

The official said that the new MPS would have some measures to create scope of offering incentives to encourage both local and foreign investment.

Economists, think-tanks and development partners earlier cautioned that the economy in the next few years would bump into some major challenges. Among the challenges is driving forward the country’s industrial sector by continuously attracting domestic and foreign investment.

Keeping in mind the long term goal of mobilizing investment from internal and external sources, the next MPS would propose incentive measures for investment in the productive sector, but with a balanced approach so the incentives would not hinder the growth of existing industries, the official said. 

Facebook 50
blogger sharing button blogger
buffer sharing button buffer
diaspora sharing button diaspora
digg sharing button digg
douban sharing button douban
email sharing button email
evernote sharing button evernote
flipboard sharing button flipboard
pocket sharing button getpocket
github sharing button github
gmail sharing button gmail
googlebookmarks sharing button googlebookmarks
hackernews sharing button hackernews
instapaper sharing button instapaper
line sharing button line
linkedin sharing button linkedin
livejournal sharing button livejournal
mailru sharing button mailru
medium sharing button medium
meneame sharing button meneame
messenger sharing button messenger
odnoklassniki sharing button odnoklassniki
pinterest sharing button pinterest
print sharing button print
qzone sharing button qzone
reddit sharing button reddit
refind sharing button refind
renren sharing button renren
skype sharing button skype
snapchat sharing button snapchat
surfingbird sharing button surfingbird
telegram sharing button telegram
tumblr sharing button tumblr
twitter sharing button twitter
vk sharing button vk
wechat sharing button wechat
weibo sharing button weibo
whatsapp sharing button whatsapp
wordpress sharing button wordpress
xing sharing button xing
yahoomail sharing button yahoomail