Monetary policy is the macroeconomic policy laid down by the central bank. It involves management of money supply and interest rate and is the demand side economic policy used by the government of a country to achieve macroeconomic objectives like inflation, consumption, growth and liquidity.
On June 30, 2022 Bangladesh Bank Governor Fazle Kabir announced the monetary policy for the new fiscal year 2022-23. Earlier monetary policy was usually announced for six months. This time it has been announced with a goal of one year.
In the new monetary policy, the increase in credit to the private sector is projected to be 14.10 percent. In light of the government’s target in the announced new monetary policy, the growth of borrowing has been fixed at 36.3 percent. And the growth of total internal debt has been estimated at 18.20 percent.
The GDP growth target for the fiscal year 2022-2023 has been set at 7.5 percent. On the other hand, the government has set a target of keeping inflation at 5.6 percent. Keeping these goals in mind, the new monetary policy has been announced.