Bangladesh Bank kept its policy interest rate unchanged at 9.5% on Wednesday, choosing to gauge the impact of domestic and global shocks on inflation and growth before making any adjustment.
The decision came at the 14th meeting of the central bank’s Monetary Policy Committee, chaired by Governor Md Mostaqur Rahman at the head office in Dhaka, where members reviewed recent domestic and global macroeconomic developments. Read Here
In July, the bank cut the rate from 10% in its first reduction in six years, and the new rate took effect on August 2.
The committee noted that inflation has been trending downward but remains above the government’s target ceiling of 7.5% for fiscal year 2026-27. The Bangladesh Bureau of Statistics reported 12-month average inflation of 8.66% for August, while point-to-point inflation was 8.26%. The central bank has said it aims to bring inflation to around 7.5% by June 2027.
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Policymakers flagged several risks that could revive price pressures in the coming months. Global energy prices remain volatile because of the prolonged conflict in the Middle East, and the government raised domestic fuel prices on September 21. The committee also said implementation of a new national pay scale could add to inflationary pressure.
Against this backdrop, the panel opted for a cautious stance and said it would closely monitor developments in the domestic and international economies, particularly their effect on gross domestic product growth and consumer price inflation, before changing the current rate.
The pause matters for Bangladesh’s export-driven industries, including the ready-made garment sector, where borrowing costs, energy bills and living expenses shape competitiveness and wage negotiations.
Deputy Governor Habibur Rahman and members Mustafa Kamal Mujeri, A K Enamul Haque, Firdousi Naher and Imam Abu Sayed attended the meeting. Monetary Policy Department director Monirul Islam Sarker was also present.